Xbox Continues To Lose Money for M$

Posted:
in General Discussion edited January 2014
Microsoft doubles loss in Xbox division



LOS ANGELES (Reuters) ? Microsoft lost nearly twice as much on its Xbox, games and consumer hardware businesses in the most recent quarter than it had a year earlier, according to a regulatory filing Monday.



Microsoft said that its Home and Entertainment division lost $190 million before taxes, write-offs and other charges in its fiscal third quarter ended March 31, compared with a loss of $97 million a year earlier.



The division's quarterly revenue fell to $493 million from $943 million a year earlier.



The loss, which is mainly due to the ongoing costs of Microsoft's one-and-a-half year effort to break into the video game business, was detailed on the same day that the software giant was preparing to announce new features and games for its Xbox machine.



A glaring absence from Xbox Live is the best-selling sports lineup from the No. 1 games publisher, Electronic Arts Inc. EA is set to announce this week that it will only support online sports play for rival Sony's PlayStation 2.



Microsoft also posted other operating losses in its other, newer businesses, as the world's number one software maker seeks to move its software beyond the desktop amid weak growth in sales of personal computers.



The company's Business Solutions division, which makes and sells software to small and medium-sized businesses, had an operating loss of $67 million on revenue of $148 million.



MSN, Microsoft's Internet access and portal service, had a loss of $92 million on revenue of $619 million.



Software for devices and mobile phones generated a $42 million loss on $39 million in revenue.



Microsoft's three flagship divisions all grew their revenue and operating profit in the third quarter from a year earlier.



Desktop software, including the Windows operating system, had an operating profit of $1.99 billion on revenue of $2.5 billion.



Server software for managing computer networks had an operating profit of $421 million on revenue of $1.59 billion.



The Information Worker segment that includes the Office suite of document, spreadsheet and e-mail programs had an operating profit of $1.94 billion on revenue of $2.47 billion.
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Comments

  • Reply 1 of 22
    fotnsfotns Posts: 301member
    Well you have to spend money to make money.
  • Reply 2 of 22
    aquaticaquatic Posts: 5,602member
    That's how a monopoly works. It's like when I mortgage property to buy boardwalk and park avenue. Looks odd at first, but then I win.
  • Reply 3 of 22
    giaguaragiaguara Posts: 2,724member
    i want an xbox ... and if i one day get one, i make it work as a werver. linux rules
  • Reply 4 of 22
    pesipesi Posts: 424member
    the lack of EA sports could be a true killer. that was one of the major factors of the Dreamcast's death.
  • Reply 5 of 22
    bungebunge Posts: 7,329member
    Quote:

    Originally posted by pesi

    the lack of EA sports could be a true killer. that was one of the major factors of the Dreamcast's death.



    I think EA Sports are still going to make XBox games, just not online games. That's a PS2 exclusive feature. Still, I hope MS loses big time on the XBox. I'm all for competition in the marketplace, but the MS & the XBox isn't fair competition. In the long run they're too untrustworthy.
  • Reply 6 of 22
    alcimedesalcimedes Posts: 5,486member
    MS pisses to many people off, and scares people. i'm sure companies like EA get all sorts of scary things whispered in their ears at meetings with Nintendo and Sony.



    MS has shown what they'll do in a market once they have a foothold. makes it tough to break into other markets down the line though.
  • Reply 7 of 22
    1337_5l4xx0r1337_5l4xx0r Posts: 1,558member
    I just hope EA can resist the overt bribing that M$ will obviously do. What is their price? Hell, even bungie had a price.
  • Reply 8 of 22
    serranoserrano Posts: 1,806member
    Quote:

    Originally posted by 1337_5L4Xx0R

    Hell, even bungie had a price.



  • Reply 9 of 22
    toweltowel Posts: 1,479member
    Quote:

    Originally posted by 1337_5L4Xx0R

    I just hope EA can resist the overt bribing that M$ will obviously do. What is their price? Hell, even bungie had a price.



    Whatever EA's price was, Sony was willing to pay it.



    Scary, though, to think that even though Sony is at least twice as big as M$ by sales, their income doesn't come close. 80% profit margins on their core businesses. Even the pharmaceutical companies are drooling.
  • Reply 10 of 22
    matsumatsu Posts: 6,558member
    And it's why M$ can afford to lose untill the other guy gives up.



    Also points to something interesting, if Apple could build a credible alternative to M$ Office and give it away "free" with the price of new machine, they stake out a lot of new ground in medium sized business and edu, which is having more and more trouble with M$ liscensing.



    Imagine, "Yeah, the boxes cost a little more, but for the life of the machine, your OS AND Office suite, with minor updates, are covered, no rental fees." One thing M$ can't afford to give away is their "Office" business.
  • Reply 11 of 22
    agent302agent302 Posts: 974member
    Quote:

    Originally posted by MacsRGood4U



    Desktop software, including the Windows operating system, had an operating profit of $1.99 billion on revenue of $2.5 billion.



    The Information Worker segment that includes the Office suite of document, spreadsheet and e-mail programs had an operating profit of $1.94 billion on revenue of $2.47 billion.




    Talk about a f*cking profit margin! They can definitely afford to take a loss for Xbox and MSN for a while.
  • Reply 12 of 22
    Quote:

    Originally posted by 1337_5L4Xx0R

    Hell, even bungie had a price.



    I still cry about this at night.

    I can't forgive the unforgivable. Burn the Marathon CDs and snap the Myth ones in two.
  • Reply 13 of 22
    gizzmonicgizzmonic Posts: 511member
    All rise. The trial of Microsoft vs. Video Gamers everywhere begins, the honorable Gizzmonic presiding.



    The defendant is charged with the following:



    Buying off good game developers including Bungie, Rare, and maybe SEGA and forcing them to go Xbox exclusive.



    The hideous case design.



    The wanky ad campaign that reeks of balding 35-yr-old men who drive Miatas and bleach their hair trying to sound 'hip' to teenagers..



    The dearth of self-congradulatory literature about the Xbox creator "genius" who decided to stick a PC inside a case.



    The hideous case design.



    Stealing Kevin Browne from the Macintosh Business Unit, which has yet to produce anything significant since his departure.



    THE HIDEOUS CASE DESIGN! Mr. Gates, the next time one of your robot sea anenomes takes a crap in your living room, do not put a Microsoft logo on it, and do not ship it as a Microsoft product. (You've been warned about repeating this behavior since Windows 95.)





    The court finds Microsoft guilty of all charges. Microsoft is hereby sentenced to release new versions of IE, Project, and WMP for the Mac.



    Bungie is hereby untethered from Microsoft, and encouraged to put Halo out on a real platform, including but not limited to Gamecube, PS2, Windows, and Mac.



    And Mr. Gates, may God have mercy on your so...actually, I don't think that's very likely. Adjourned!
  • Reply 14 of 22
    rokrok Posts: 3,519member
    didn't microsoft say thyey expected to lose money ont he xbox for five years solid before turning a profit?



    if that doesn't point to having too much power in a capitalist society, i don't know what does. who the hell can compete with that?!? sure, sony can, but only because they established a firm foothold. same can be said of nintendo. but how can anyone else come into the market, and say "yes, we have enough money to lose hand over fist until 2008 before we can start turning a profit in the console business..." nobody can, that's who.



    my only hope is that microsoft's continued divided attention among all of their acquisitions and projects will eventually come back and bite them in the ass, when a time will come that they will need a very strong section, and find they don't have any.
  • Reply 15 of 22
    hobbeshobbes Posts: 1,252member
    Quote:

    Originally posted by Matsu

    Imagine, "Yeah, the boxes cost a little more, but for the life of the machine, your OS AND Office suite, with minor updates, are covered, no rental fees." One thing M$ can't afford to give away is their "Office" business.



    Right on the money. If Apple can pull off a really good, really compatible Office suite, they'll have the best selling point vs. buying a Wintel box they've had a long while.



    It'll take some time, though. I bet the initial verison of Apple's suite will be aimed at consumers (good-looking, easy to use, compatible, modest feature set -- like Keynote), and ramp up over subsequent versions to compete against the giant Office. Thus, if Office v.X 2003/4 is the last version, it'll only be to Apple's advantage.



    Anyhoo.
  • Reply 16 of 22
    gizzmonicgizzmonic Posts: 511member
    Quote:

    Originally posted by Hobbes

    Right on the money. If Apple can pull off a really good, really compatible Office suite, they'll have the best selling point vs. buying a Wintel box they've had a long while.



    It'll take some time, though. I bet the initial verison of Apple's suite will be aimed at consumers (good-looking, easy to use, compatible, modest feature set -- like Keynote), and ramp up over subsequent versions to compete against the giant Office. Thus, if Office v.X 2003/4 is the last version, it'll only be to Apple's advantage.



    Anyhoo.




    That makes not much sense. What's better than 100% Word, Office, and Powerpoint compatibility already available in Microsoft Office?



    Office on the Mac is a big legitimizer of the platform. If they go, then Apple may have to beef up Appleworks, but I don't think they should try.



    They definitely will not ever gain any ground the business market without Office.
  • Reply 17 of 22
    hobbeshobbes Posts: 1,252member
    This is veering totally off-topic, but...



    Quote:

    Originally posted by Gizzmonic

    That makes not much sense. What's better than 100% Word, Office, and Powerpoint compatibility already available in Microsoft Office?



    For Apple, or the consumer? Consumer: 100% compatible; not overpriced; introduction (one can only hope) of innovative ideas applied to a genre of apps that haven't seen genuine competition in a long time. Apple: not being under the thumb of MS threatening to cancel Office v.X; a new revenue stream; the ability to bundle Apple Office w/ new machines and compete at last with Wintel.



    Quote:

    Office on the Mac is a big legitimizer of the platform. If they go, then Apple may have to beef up Appleworks, but I don't think they should try.



    Appleworks is not being developed any further. Take a good look at the current version number.



    Quote:

    They definitely will not ever gain any ground the business market without Office.



    This has become considered common wisdom, but it's really not correct. Some PC manufacturers have begun shipping Corel WordPerfect Office in place of MS Works, and consumers don't really care (or even notice). All people want is to be able to open and work with Word and Excel document formats.



    If Apple plays its cards right, with an excellent product, they have a opportunity. And any business willing to consider a Mac will also consider an Office-compatible Apple Office suite.
  • Reply 18 of 22
    klinuxklinux Posts: 453member
    Coming back to topic. I don't game but I think Microsoft entering the market (Note to Matsu - typing M$ is so 1999!) is a great thing i.e. forcing companies to innovate, lower price, etc.
  • Reply 19 of 22
    dstranathandstranathan Posts: 1,715member
    Quote:

    Originally posted by pesi

    the lack of EA sports could be a true killer. that was one of the major factors of the Dreamcast's death.



    This will be fun to watch...



    I thave a pal who thinks that Microsoft may buy Sega, what do you think?
  • Reply 20 of 22
    doctorgonzodoctorgonzo Posts: 529member
    Quote:

    Originally posted by klinux

    Coming back to topic. I don't game but I think Microsoft entering the market (Note to Matsu - typing M$ is so 1999!) is a great thing i.e. forcing companies to innovate, lower price, etc.



    My thoughts exactly.



    The pressure on each of the three main console makers from the other two is enormous and has only helped the gaming community. Complacency is no longer possible, and while I don't like Microsoft at all, I must say that their presence in the console world is a good thing and the Xbox - despite its terrible case design is an excellent console with a very nice library of games.



    Of course, if you took 99% of the PS2 and GC libraries and ported them to the Xbox, anti-Microsoft zealots would still tell you "the only good game on the Xbox is Halo".
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