Computer pricing pressures have squeezed Gateway

The group said losses had widened to $114.1m from $72m in the same period last year.

The loss was in line with a recent warning from the firm that a move into consumer electronics had failed to offset price pressure on PCs.

Chief financial officer Rod Sherwood declined to give Gateway's financial outlook for the current three months.

Mr Sherwood added: "We're not providing guidance at this time. We'll have more to say along those lines in the near future."

Revenue at the California based firm also fell to $875.1m from $1.06bn.

Reversal of fortune

Meanwhile, fellow technology firm, Canadian-owned Nortel Networks posted its second consecutive rise in quarterly profits, as its sales approached the $3bn mark.

The group reported net income of $499m, reversing a loss of $168m a year earlier.

Chief executive Frank Dunn said he expected the company "to grow faster than the market" in 2004.

But he also warned sales were likely to experience a "seasonal decline" in the current first quarter compared to the last three months of 2003.

The recent recovery follows a three-year slump that besieged the networking industry.

To get back in the black, Nortel has cut thousands of jobs, closed operations and marked down the worth of assets whose value had diminished.

Earlier this month, the firm won an exclusive contract to supply technology to help Verizon Communications upgrade its network to enable phone calls to be sent over the internet - a way for firms to cut down on communications costs.

And last week, Nortel raised the possibility of selling manufacturing assets in a bid to fiurther cut costs and free up more cash to develop new products.