MS almost doubles it's losses with Xbox (merged)

**ScorpionX** · 02-02-2003

http://money.cnn.com/2003/01/31/tech...icrosoft.reut/

Microsoft's Home and Entertainment segment, which includes the Xbox, games for personal computers and the company's TV products, posted an operating loss of $348 million in the quarter on revenue of $1.28 billion. A year earlier it had revenue of $833 million and a loss of $180 million.

The company loses money on each Xbox it sells, with some analysts pegging the shortfall at more than $100 per $199 console, meaning that strong sales for the platform actually increase its losses.

Bad news for Xbox

**thatroger** · 02-02-2003

Most people dont' realize this part. Once the Xbox gets a large installed base they start making their money off the games. Less and less xboxs are sold and more games are sold, increasing prrofits.

**Kraft** · 02-02-2003

Originally posted by thatroger
Most people dont' realize this part. Once the Xbox gets a large installed base they start making their money off the games. Less and less xboxs are sold and more games are sold, increasing prrofits.

I'm glad some people understand this fact. Also, even though MS profit is down they still made 1.97 BILLION dollars. That't not too bad considering the amount of money a lot of other companies are losing, you know, with us being in the middle of a recession and all.

**carlbme** · 02-02-2003

Originally posted by Kraft-XBA
I'm glad some people understand this fact. Also, even though MS profit is down they still made 1.97 BILLION dollars. That't not too bad considering the amount of money a lot of other companies are losing, you know, with us being in the middle of a recession and all.

AOL comes to mind coming in with a loss of 99 Billion.

**hiter101** · 02-02-2003

this is pretty much old news

and btw MS is in this for the long haul so dont worry it wont pull a sega on u

**Qbas** · 02-02-2003

Originally posted by hiter101
this is pretty much old news

and btw MS is in this for the long haul so dont worry it wont pull a sega on u

Thanks to MS's Windows OS and Office packages.

**Evil_Dr_Beefy** · 02-02-2003

C'mon guys..it's not as bad as you think..348 million dollars is pocketchange for a muti -billion dollar company..i guess the Ps2 fanboys have something to talk about now......but it's cool microsoft knew about the losses before hand.......

Frostberg · 02-02-2003

Lets not forget the point that with every Xbox MS sells that they lose $160 or so...so in effect if they sell a 4 or a billion xboxes they will STILL be losing money...

So obviously they are prepared for it...

**clientkiller** · 02-02-2003

there is no real need to worry infact it shows that microsoft are making alot of money on the xbox because if you think about it this includes all the other things microsoft are doing including the tv stuff and thats where aol have lost alot of their money so i reakon thats where micosoft lost alot of theirs

although microsoft lose money on the console they make money on the dvd remote control. the xbox pads which in england are £5 more expensive then ps2 ones and also they will be making alot of money on the games. i think they are making around £5 - £10 per game cos a game serious sam was only £20 on the pc but its £35 for the xbox so i think they are making alot of money that way.

they also own alot of developers are they making money or losing it tho?

**Casper** · 02-03-2003

There has been speculation that Microsoft will NEVER make a penny off the Microsoft Xbox, and that they are just planting themselves in the market. Microsoft will worry about making money on the 2nd generation console, it sure looks like that:

Microsoft's Home and Entertainment segment, which includes the Xbox, PC games and the company's TV products, posted an operating loss of $348 million in the quarter on revenue of $1.28 billion. A year earlier it had a loss of $180 million on revenue of $833 million.

In a quarterly report with the SEC filed Friday, Microsoft said it posted operating income of $1.97 billion in the December-ended quarter in its Windows-centered business unit on revenue of $2.44 billion. That was down from income of $2.11 billion and revenue of $2.68 billion in the year-earlier period.

Read more about it here

**Whisper** · 02-03-2003

so xbox1 is doomed.

**J Dub** · 02-03-2003

I don't understand what all this crap means.

Microsoft's Home and Entertainment segment, which includes the Xbox, PC games and the company's TV products, posted an operating loss of $348 million in the quarter on revenue of $1.28 billion.

Does that mean that they lost $348 million but made $1.28 billion? Therefore they made more than they lost.....right? Confused...

**Qbas** · 02-03-2003

MS allways gets their money back from Windows, MS Office products etc.

**HaloMasterVI** · 02-03-2003

Originally posted by Scorpion}{
http://money.cnn.com/2003/01/31/tech...icrosoft.reut/

Don't forget, cnn is in direct competition with MS. CNN Hates MS.

Bill is in it for the long term.

Bad news for Xbox

**Slacker** · 02-03-2003

this is the stupidest thread!!!........Really you have to be an idiot to think thats bad news for Xbox.....348 million , out of 5 BILLION!! just for the dumb people it takes one thousand million to make one billion! and Microsoft has Set aside 5 BILLION for Xbox, please don't post Anti-Microsoft propaganda on an Xbox board and try to use your head .........no offense to anyone I'm just sick of this thread, this must be 100th time it's been posted

**Kraft** · 02-03-2003

Originally posted by Slacker
this is the stupidest thread!!!........

A little off topic, but 'stupidest' isn't a word. I guess that makes your post the 'dumbest' post in the 'stupidest' thread. Just because ms set that much aside doesn't mean that we want to see them burn through it all. Who is going to want to buy an xbox 2 if they see that MS is still losing money off the first one?

**Casper** · 02-03-2003

Originally posted by Slacker
this is the stupidest thread!!!........Really you have to be an idiot to think thats bad news for Xbox.....348 million , out of 5 BILLION!! just for the dumb people it takes one thousand million to make one billion! and Microsoft has Set aside 5 BILLION for Xbox, please don't post Anti-Microsoft propaganda on an Xbox board and try to use your head .........no offense to anyone I'm just sick of this thread, this must be 100th time it's been posted

Wow, you mean to tell me that one thousand million makes one billion....wow, you should be a dam financial analyst for Enron...look, this isn't anti--MS propoganda material, you do realize that if they set it aside (which by reading the article more in depth, some of it was borrowed) does not mean that they can go and make stupid moves that are dumber than your post. It's just showing that they despite the better # in sales, it's actually hurting them on console sales because they are losing per Xbox...now, if you have a problem with that...then just walk on by....

Good day sir!

**TheCovenant** · 02-03-2003

isnt this like really old news?

well anyway, microsoft announced that they would double down and reduce their losses, and actually turn their losses into profit. simple.

just becuase they did not reach what they wanted, doesnt mean it isnt a lot....

**ScorpionX** · 02-03-2003

Watching the figures, it comes as no great surprise that nVidia might be backing away from future deals. Microsoft is losing money hand over fist in its Home and Entertainment division which is responsible for the Xbox and component suppliers are facing the pinch as well. nVidia itself is in legal arbitration with Microsoft over the cost of components.

Over at SiliconValley.com, nVidia CEO Jen-Hsun Huang sounded a very cautious note, "we would be delighted to work with Microsoft on the next Xbox, but we are a company with many opportunities." Which sounds to us like he really isn't interested in playing ball.

http://www.theinquirer.net/?article=7579

Nvidia doesn't seem to confident in Xbox 2

**Kraft** · 02-03-2003

Originally posted by Scorpion}{
http://www.theinquirer.net/?article=7579

Nvidia doesn't seem to confident in Xbox 2

This is due to the fact that MS is pretty much telling them what they are going to do otherwise they are going with ATI. They are being ruthless with developing their gaming systems.