Gateway turned a profit for the first time in more than three years but jolted investors by slicing its full-year sales and earnings outlook.
The 2004 period included a $289 million restructuring charge, largely for costs associated with the store closures and job cuts.
Gateway said last night it had earned $17.2 million, or five cents a share, compared to a loss of $338.6 million, or 91 cents a share, the same period last year, marking its first profit in 13 quarters.
The latest period includes restructuring charges of $1 million and a $15.1 million benefit from a marketing and legal settlement with Microsoft.
The 2004 period included a $289 million restructuring charge, largely for costs associated with the store closures and job cuts.
Revenue grew 4.2 per cent to $873.1 million from $837.6 million, boosted by booming PC sales. The company sold more than one million PCs during the quarter, up from 795,000 last year.
Gateway said pricing and component-cost pressures contributed to its lower earnings forecast for 2005.
It cut its profit estimate to between 11 cents and 13 cents a share from its previous estimate of between 15 cents and 17 cents a share, and its revenue forecast to between $3.9 billion and $4 billion from between $4 billion and $4.25 billion.