Microsoft's Revenues Up Except for Games Division

Gamasutra reports on Microsoft's announcement that their revenues are up, but the games division has seen a sharp decrease in profitability. From the article: "Microsoft's Home and Entertainment division, which overall includes the Microsoft Xbox video game console system, PC games, the Home Products Division, and TV platform products for the interactive television industry, saw revenue of $1.56 billion in the 3 months to the end of December and a significant loss of $293 million, compared to $1.37 billion revenues and a small profit of $55 million in the same period last year."

Comments

Misleading headline

[ThisIsForReal]

...except for game division?

FTA: Microsoft's Home and Entertainment division, which overall includes the Microsoft Xbox video game console system, PC games, the Home Products Division, and TV platform products for the interactive television industry, saw revenue of $1.56 billion in the 3 months to the end of December and a significant loss of $293 million, compared to $1.37 billion revenues and a small profit of $55 million in the same period last year.

Grrr, the headline made it sound like revenue for the game division was down, but it was up, too. Please keep the headlines accurate for those of us who don't want to read the synopsis, let alone the actual article!

In other words, the XBox 360 plant was expensive.

[Thag]

I'm guessing that's what we're seeing: the startup costs for the Xbox 360 and its launch publicity. So even though revenues were up, the increased operations costs turned it into a net loss, for now at least.

I would expect the 360 to be profitable for them in the long run, though.

Jon Acheson

Re:XBOX 360

[Keeper]

Incorrect.

Revenue == total money in (money made from selling stuff)
Expenses == total money out (money spent building stuff)
Net income == revenue - expenses