Gateway announced today that company co-founder Ted Waitt has resigned as chief executive officer. He was replaced by Jeff Weitzen, who will retain his title as president.

The transition will take place on 1 January and Waitt will continue to serve as chairman of the board. Although Waitt did not say why he has decided to step down, the departure was expected as Waitt had taken a less active role in managing the company's daily operations in recent years.

Weitzen, who joined the company almost two years ago as president, has been seen as a key player in Gateway's growth. "Jeff's appointment to CEO is both a formalisation of the roles we've essentially been playing for the last year and a recognition of the outstanding job he's done preparing Gateway for the next century," said Waitt.

Under Weitzen's leadership at Gateway, the company has undergone a major change from a PC hardware integrator to a worldwide technology solutions provider. Gateway, for example, became the first PC manufacturer to provide an extensive choice of peripherals and software, a personalised Internet portal and bundled Internet access with the purchase of most Gateway PCs.

Last January, the company had just recovered from financial losses in the third quarter of 1997. Now, Gateway continues to gain market share, although margins are declining.

In the third quarter, Gateway grew faster than all other PC companies except Dell. Part of the growth came from the Country Store outlets which gave Gateway a retail presence. The company also launched its Yourware program, which allowed it to sell additional hardware, software and ISP services for low monthly payments.

"What Ted has done that has been instrumental in the last year is assemble a top-notch management team," said Ashok Kumar, an analyst with US Bancorp Piper Jaffray. "If Ted totally distanced himself from the company, the street would be uneasy. Instead, we'll have the best of both worlds."