Gateway Reports Third Quarter Results

Gateway Reports Third Quarter Results

Gateway, Inc. (NYSE: GTW) today reported results for its third quarter ended September 30, 2006. Revenue amounted to $963 million, up from $919 million in the second quarter of 2006 and compared to $1.019 billion a year earlier. Operating income equaled $7.9 million, up from a loss of $6.9 million in the second quarter and compared to $18.8 million a year earlier.

The company recorded a third quarter net income of $18.2 million, or 5 cents per diluted share, after a net tax benefit of $8.2 million. This compares with a net loss of $7.7 million, or 2 cents per diluted share in the prior quarter, and net income of $15.1 million, or 4 cents per diluted share a year earlier.

“Gateway showed marked improvement in its operating results compared to recent quarters. I am particularly pleased by the improvements in our Professional business,” said Ed Coleman, Gateway’s chief executive officer. “In addition, our retail business continued to generate growth in units and revenue, despite an increasingly competitive environment. While encouraged with these results, we have much work ahead of us to improve our execution and efficiency, leverage the Gateway brand and position the Company so that Gateway lives up to its full potential.”

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