Spartan_X Posted January 26, 2007 Share Posted January 26, 2007 Microsoft: 4.4 Million Xbox 360s Shipped, Division Loss, Cuts Estimates According to Microsoft's second quarter results for the period ending December 31st 2006, the company's Xbox-encompassing Entertainment and Devices division posted a $289 million loss, despite an overall $2.63 billion profit for the entire company during the period. The $289 million divisional loss for the quarter remains more or less identical to the $286 million loss the year prior. Microsoft posted a $1 billion increase in revenue in E&D during the quarter, and a $1.3 billion increase for the first half, as well as a 76 and 82 percent revenue jump respectively for its Xbox and PC game software divisions. However, the company said, development and marketing expenses related not just to the Xbox 360 hardware, but also the launch of its portable media player Zune (also part of the E&D division) offset those revenues, bringing losses to a similar level to last year's. The E&D division includes the Xbox 360 hardware and software, PC games, the Zune digital music and entertainment device, TV platform products for the interactive television industry, and mobile and embedded devices. In particular, the extension of the Xbox 360 console warranty from 90 days to one year in the U.S. and Canada, as well as general repair expenses also cut into the division's profitability, according to statements released alongside the company's financials. Microsoft also said it has moved 4.4 million Xbox 360 consoles during the quarter ending December 31st 2006, bringing the first half of fiscal 2007 total to 5.4 million consoles sold. Since the console's launch in November of 2005, the company indicated that it has sold a total of 10.4 million. Software sales, as previously reported, were driven in the quarter primarily by Gears of War. Looking forward, Microsoft is hopeful that its console innovation, portfolio of video game content for the console, online offerings, and the market share of the console gives the company a "strategic advantage for the long-term success of Xbox 360." Overall, the company's $2.63 billion profit was down 28% from a $3.65 billion figure last year, partly thanks to the delay of business and consumer elements of Windows Vista, but was still well-received by analysts, since it beat their estimates for the quarter. Shares were up 57 cents to $31.02 in after-market trading. [uPDATE: Talking immediately following the earnings, Microsoft CFO Chris Liddell has cut the company's estimates for Xbox 360 hardware from 13-15 million to 12 million for the fiscal year ending June 30th, 2007. The company had shipped 10.4 million Xbox 360s to stores by the end of 2006. According to remarks made to news agency Reuters, Liddell commented of the Xbox 360 targets: "We are just being cautious about the second half. It was always going to be a slow half. We've done very well in the first half. There is a reasonable amount of inventory in the channel."] Source: Gamasutra Link to comment Share on other sites More sharing options...
Epimetheus Posted January 26, 2007 Share Posted January 26, 2007 When as the Xbox division EVER had a profitable year? What it was around the Halo 2 launch right? I'm not trying troll here either, it's just a ridiculous business strategy to continue to support a division that is losing money for your entire business constantly. Link to comment Share on other sites More sharing options...
Brandon Live Veteran Posted January 26, 2007 Veteran Share Posted January 26, 2007 When as the Xbox division EVER had a profitable year? What it was around the Halo 2 launch right?I'm not trying troll here either, it's just a ridiculous business strategy to continue to support a division that is losing money for your entire business constantly. Not really... Not when you can afford to, expected to, and the long-term potential is so great. Link to comment Share on other sites More sharing options...
maash Posted January 26, 2007 Share Posted January 26, 2007 you people SHOULD know why they are cutting estimates or do I have to tell you Link to comment Share on other sites More sharing options...
AlphaPrime Posted January 26, 2007 Share Posted January 26, 2007 [uPDATE: Talking immediately following the earnings, Microsoft CFO Chris Liddell has cut the company's estimates for Xbox 360 hardware from 13-15 million to 12 million for the fiscal year ending June 30th, 2007. The company had shipped 10.4 million Xbox 360s to stores by the end of 2006. Wow, they're only shipping 1.6 million units worldwide for the entire first half of 2007? Link to comment Share on other sites More sharing options...
maash Posted January 26, 2007 Share Posted January 26, 2007 Wow, they're only shipping 1.6 million units worldwide for the entire first half of 2007? let me give you a clue in, right now the CPU in 360 is 90nm, it will be 65nm at the beginning of fall, which will also come with the HDMI + 120 GB, price of the current SKU will fall considerable perhaps to around 299 from 399, they are just going to want every 90nm gone from the market by the time 65nm ships Link to comment Share on other sites More sharing options...
+vlsi0n Subscriber¹ Posted January 26, 2007 Subscriber¹ Share Posted January 26, 2007 When as the Xbox division EVER had a profitable year? What it was around the Halo 2 launch right?I'm not trying troll here either, it's just a ridiculous business strategy to continue to support a division that is losing money for your entire business constantly. :sleep: So they should drop the Xbox 360 hardware and software, PC games, the Zune , TV platform products for the interactive television industry, and mobile and embedded devices. Nah, I think they know their doing. Link to comment Share on other sites More sharing options...
HawkMan Posted January 26, 2007 Share Posted January 26, 2007 let me give you a clue in, right now the CPU in 360 is 90nm, it will be 65nm at the beginning of fall, which will also come with the HDMI + 120 GB, price of the current SKU will fall considerable perhaps to around 299 from 399, they are just going to want every 90nm gone from the market by the time 65nm ships fud Link to comment Share on other sites More sharing options...
AlphaPrime Posted January 26, 2007 Share Posted January 26, 2007 let me give you a clue in, right now the CPU in 360 is 90nm, it will be 65nm at the beginning of fall, which will also come with the HDMI + 120 GB, price of the current SKU will fall considerable perhaps to around 299 from 399, they are just going to want every 90nm gone from the market by the time 65nm ships Maybe; still don't know whether they will ever release a HDMI version, let alone one with 120GB. Whatever the case, it's probably because they shipped too many last quarter and still have a lot left to sell to consumers, so the retailers aren't asking for as many. Link to comment Share on other sites More sharing options...
maash Posted January 26, 2007 Share Posted January 26, 2007 fud bet a $1000? Link to comment Share on other sites More sharing options...
spenser.d Posted January 26, 2007 Share Posted January 26, 2007 bet a $1000? Microsoft denied that rumor a while back. And when I say 'denied' I don't mean they gave their usual "We don't comment" BS, they flat-out told us that that those 360's existed, but just in their experimental labs, and they had absolutely no plans to market them. -Spenser Link to comment Share on other sites More sharing options...
neoadorable Posted January 27, 2007 Share Posted January 27, 2007 how are you going to collect those 1000 smackers if he says yes? if i was the other guy i'd hold on to the money, buy two of those revamped 360's you claim will happen, and have the last laugh. Link to comment Share on other sites More sharing options...
MGS4-SS Posted January 27, 2007 Share Posted January 27, 2007 bet a $1000? I'll take that bet ;) Link to comment Share on other sites More sharing options...
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