SAN DIEGO - Gateway Inc., the second-largest direct seller of personal computers, will fire all 1,050 employees in Ireland and the United Kingdom as part of a plan to revive profit by concentrating on U.S. sales.
Gateway said last month that it would cut 5,000 jobs worldwide and halt business in Asia. The company said yesterday that it will stop selling computers in southeastern Europe, the Middle East and Africa, as well as in Ireland and the United Kingdom. The San Diego-based company has already pulled out of the Spanish, German and Swedish markets.
Chief Executive Officer Ted Waitt is trying to salvage Gateway as the PC industry braces for its first yearly sales drop since 1985. As rivals such as Dell Computer Corp. have cut PC prices to boost sales, Gateway has reported three consecutive quarterly losses and forecast another for this period. The company is hoping that closing its retail stores and moving out of markets overseas, where its brand and distribution aren't as strong, will help restore profit.
"Gateway has a brand that is reasonably recognizable, but it's not one of the world's top brands," said Mark Specker, an analyst at SoundView Technology Group, who doesn't own Gateway shares and rates the stock "hold."
The company will fire 900 workers at its Dublin plant, which also served as its European headquarters, and 150 in the United Kingdom, where it has 14 retail stores, spokeswoman Noeleen Murray said.
Gateway has said its overseas business kept it from being profitable last quarter. Gateway didn't have adequate distribution channels, and it was difficult to work with foreign partners, Waitt said in an interview two weeks ago.
Gateway shares fell 5 cents to $8.46 yesterday. The stock has fallen 53 percent this year.