Gateway plans to cut a quarter of its global workforce and exit most of its overseas market.
The move by the US computer maker will include chopping around 5,000 staff and shutting its Salt Lake City factory.
Gateway said yesterday it expected the cutbacks to save it $300 million per year.
The company is axing its businesses in Asia Pacific, while "employee consultation" is going on with regard to exiting Europe. A decision is expected to be reached on Europe within the next 30 days.
The San Diego-based company plans to take a $475 million charge in the third quarter.
"As tough as these decisions were to make, we're doing all the right things to create a new company with a unique competitive edge and a healthy, profitable future," said Gateway chairman and CEO Ted Waitt.
Gateway, which earlier this month announced the closure of its operations in Ireland and the UK, said it expected to return to profitability in the fourth quarter. ®