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Gateway aiming for profitability in '05

At a shareholders' meeting, company executives said that Gateway will achieve profitability in part by cutting its work force and simplifying its product lines.

Gateway plans to be profitable in 2005, the company's senior executives said Thursday at an annual shareholders' meeting. The PC maker, which acquired eMachines in March and then closed its chain of retail stores in April, is following a plan that aims to create profit in part by simplifying its operations.

Thus, after the store closings, the company enacted a number of additional changes, including, as previously reported, a plan to reduce its employee roster from 3,500 to 2,000 by the end of this year. The lower headcount will cut Gateway's sales, general and administrative expenses, while an effort to simplify product lines will also help reduce costs. The company, for example, will employ measures such as sharing more components between models. Gateway, which is also pursuing relationships with retailers in an effort to boost unit shipments, will launch its first post-merger PCs in August, the executives said.