Gateway was founded on September 5, 1985, on a farm outside Sioux City, Iowa, by Ted Waitt and Mike Hammond. Originally called Gateway 2000, it was one of the first widely successful direct sales PC companies, utilizing a sales model copied from Dell, and playing up its Iowa roots with low-tech advertisements proclaiming "Computers from Iowa?". Shipping computers in spotted boxes patterned after cow markings (specifically, Holstein cows) became a Gateway standard. In 1989 Gateway moved its corporate offices and production facilities to North Sioux City, South Dakota. In line with the Holstein cow mascot, Gateway opened a chain of retail stores called Gateway Country Stores, mostly in suburban areas across the United States. It dropped the "2000" from its name on October 31, 1998.
In 1998, Gateway relocated from North Sioux City, South Dakota to San Diego, California and then in 2001 made another move to Poway, California. After acquiring eMachines in 2004, Gateway again relocated their corporate headquarters to Irvine, California.
Gateway purchased the Amiga assets from Escom in 1997 and since 2000, this Amiga intellectual property has been licensed to Amiga, Inc..
Gateway struggled after the dot-com bust and tried several strategies to return to profitability, including withdrawal from international markets, reduction in the number of retail stores and most significantly, entering the consumer electronics business. However, none of these efforts were particularly successful from a financial standpoint, and Gateway continued to suffer major losses as well as market share in the PC business. By April 1, 2004, Gateway had announced that it would shut down its 188 remaining stores.
On March 11, 2004, Gateway purchased low-cost PC marketer eMachines, for US$30 million in cash and 50 million shares of stock, valuing the deal at approximately US$262 million with announced intentions to keep the eMachines brand. Gateway had hopes that eMachines' retail channel strength would complement its own strengths in consumer and business direct channels. Through the deal, founder Ted Waitt turned over day-to-day responsibilities and the CEO role to eMachines' CEO, Wayne Inouye, and remained as chairman through May 2005. Inouye announced his resignation as CEO on February 9, 2006; Chairman Richard Snyder served as interim CEO until September 7 2006 when J. Edward Coleman was brought in as the new CEO. Gateway still sells both Gateway and eMachines brand computers through retail vendors like Circuit City, Best Buy, TigerDirect, Wal-Mart, and CompUSA. Its Gateway brand products continue to be available in direct channels.
Like most large corporations, Gateway has outsourced some of its operations, such as customer support. In 2002, Gateway expanded into the consumer electronics world with products that included plasma screen TVs, digital cameras, DLP projectors, wireless internet routers, and MP3 players. While the company enjoyed some success in gaining substantial market share from traditional leaders in the space, particularly with plasma TVs and digital cameras, the limited short-term profit potential of these product lines led then-CEO Wayne Inouye to pull the company out of that segment during 2004. Gateway still acts as a retailer selling third-party electronic goods online.
Recently, Gateway has resourced customer support within North America, priding itself as "100% North America-based support". Gateway has also moved build-to-order desktop, laptop, and server manufacturing back to the United States, with the opening of its Gateway Configuration Center in Nashville, Tennessee in September 2006. It currently employs 385 people in that location. As of April 2007 Gateway notebook computers were produced in China and its desktops had "made in Mexico" stickers.
On October 16, 2007, Acer completed its acquisition of Gateway for US$710 million. J.T. Wang, the company's chairman, said in a statement that the acquisition "completes Acer's global footprint, by strengthening our U.S. presence.
