Xbox likely to fall short of key sales target

Sales figures for the Xbox are likely to fall over a million units short of Microsoft's goal of selling nine million units by June unless the company cuts the price drastically, according to the latest research from market analysts.

According to Michael Pachter, an analyst at Wedbrush Morgan securities, Microsoft is likely to miss this sales target by a significant margin - with a realistic estimate of worldwide sales for the console sitting at between 6.5 and 6.6 million units. In order to make up the figures in time for June, Pachter believes that a very significant price cut will be necessary - significantly larger than the 20 per cent drop which took effect in Europe late last week. However, his estimates suggest that if the European price-cut were applied worldwide, it could boost sales by up to a million units.

Ironically, if the Xbox misses its sales targets, this will actually help Microsoft's bottom line financially. The company is still losing a vast amount of money on sales of the Xbox hardware - at least $100 on each unit, and quite probably more - in contrast to Nintendo and Sony, both of whom are thought to be making profits on their hardware thanks to cheaper manufacturing costs and, in Sony's case, the age of many components.

News source: The Reg

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