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Stock Analyst Update

Gateway Makes the Best of a Tough Quarter

First-quarter earnings were as expected, despite weak demand.

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Despite spotty corporate demand, Gateway (GTW) managed to put together a decent first quarter.

By the time Gateway reported earnings on Thursday evening, it was clear the first quarter wasn't going to be kind to personal-computer makers. The Y2K-related slowdown in corporate technology spending persisted until March, causing Gateway's revenues to decrease by 5% from the first quarter of 1999--lower than the flat growth originally expected. But because the company generated higher margins in the quarter, it was able to post earnings of 41 cents per share, exactly in line with the consensus estimate.

Jeremy Lopez does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.