Sometimes cheap isn't cheap enough.

eMachines

(EEEE)

found out Friday that it is much more successful in selling its inexpensive Internet-access computer than in luring investors to buy its seemingly reasonably priced stock.

Shares of eMachines fell 3/4, or 8%, to close at 8 1/4 in its first day of trading amid concerns that the company might not be able to maintain its lead in the market for cheap Internet-oriented computers.

eMachines, which set out to challenge more established computer makers like

Dell

(DELL) - Get Report

and

Gateway

(GTW)

, sold 20 million shares in its initial public offering at $9 a share, raising $180 million.

The Irvine, Calif.-based company has seen explosive growth in demand for its stripped-down, Internet-ready computers. But while the company has tried to portray itself as a maker of Internet appliances rather than personal computers, analysts and investors have been wary of giving their full blessing to what they see as a small player in the low-margin cutthroat PC business.

The company posted revenue of $815.5 million in 1999, and $58.3 million in the four months that followed its September 1998 startup. eMachines has sold about 2 million computers since its startup.

But the strong 1999 sales, which included revenues resulting from its acquisition of

FreePC

, resulted in a net loss of $84.5 million in 1999.

eMachines dropped FreePC's strategy of giving customers hardware in exchange for signing an Internet-service contract, but has relied heavily on FreePC's expertise in marketing.

Despite Wall Street's weak reception for eMachines' stock, other new issues fared well Friday.

Silicon Labs

(SLAB:Nasdaq), a maker of integrated circuits for wired and wireless communications devices, opened at more than double its $31 opening price, and closed at 69 3/8, up 124%,or 38 3/8. Web consulting business

Eprise

(EPRS:Nasdaq) also debuted Friday and rose 68%, or 10 1/4, to close at 25 1/4.

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