July 25th, 2007
Xbox division post $1.9 billion loss
Microsoft continues to plough money into Xbox, but a profit is nowhere in sight.
On Friday the Xbox division posted a staggering $1.9 billion loss. This loss is partly down to the absorb $1.2 billion the company had to throw as upgrading the 360s warranty and maintenance program. I’m betting that the disc scratching lawsuits will have a negative effect on profits over the coming months.
It’s not all gloom though. Microsoft has managed to dramatically cut the manufacturing costs of the Xbox 360.
The more I look at how Microsoft markets the Xbox, the more convinced I become that not only won’t it turn a profit any time soon, but that Microsoft isn’t interested in making a profit - it’s all about hammering Sony’s market share. however, I’m pretty sure that Microsoft didn’t bank of the Wii being the runaway success that it’s become, forcing the company to fight a games console war on two fronts. This means that the hope of seeing a profit has been pushed further into the future.
Thoughts?
Adrian is a technology journalist and author who has devoted over a decade to helping users get the most from technology. He also runs a popular blog called The PC Doctor. See his full profile and disclosure of his industry affiliations
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