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EARNINGS

3rd-Quarter Net Drops 38% for Gateway

October 22, 1986|GREG LUCAS

Gateway Communications Inc. said its third-quarter net income was $441,959--a 38% drop from the $713,805 reported a year earlier. Revenues for the third quarter were $3.3 million--a 65% increase from $2 million.

The Irvine-based manufacturer of systems to link personal computers showed profits of $1 million for the first nine months of 1986, up 20% from $834,658.

The drop in third-quarter earnings was expected because earnings for the same quarter last year were inflated by a $237,350 tax loss carry-forward, said Michael E. Dailey, Gateway's controller.

A $54,650 tax loss carry-forward in the second quarter of 1985 combined with the third-quarter carry-forward to boost Gateway's nine-month results by $292,000, Dailey said.

He said the company expects no carry-overs in the current or future fiscal years. Since 1985, the company has increased the number of its employees from 21 to 42. In the first nine months of 1986, Gateway has spent $1 million on marketing its computer-linking systems, contrasted with $421,392 for the first nine months in 1985.

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