Microsoft Continues To Lose Money With Each Surface Tablet It Sells

DroidJason1 writes: "Revealed from a 10-Q filed by Microsoft with the U.S. Securities and Exchange Commission, Microsoft has been losing $300 million and counting for the Surface in the last nine months. Data from Strategy Analytics has also revealed that Microsoft's Windows-powered tablets now own a 6% global tablet share, in Q1 of 2014. Android, on the other hand, remains at the top with a 66% global share. Apple's iOS fell to 28%."

Comments

The Mircro$oft $urface

[penguinoid]

Just kidding, they can have their S back. For now.

The gap seems reasonable

[mechtech256]

"In the last nine months, Microsoft spent $2.1 billion on the Surface, and gained $1.8 billion in revenue"

That gap really isn't too bad, certainly better than the Xbox/360/XB1 numbers which follows the same strategy of selling at a loss (after marketing) and making it up later with services. The mere fact that Microsoft is actually doing 500 million dollars a quarter in Surface is actually quite impressive.

Right now Microsoft needs market share, so I'd say the strategy isn't altogether a bad one. Especially considering that 2 Billion USD in hardware sales is definitely going to result in at least a couple hundred million in service revenue from Office and such.

So What?

[rudy_wayne]

Microsoft lost a few hundred million on the Surface tablet. Twitter has never made money lost $500 Million in the most recent quarter.

So what?

Gates said it

[Anonymous Coward]

Microsot can skew the market with billions of dollars and attack any market segment it wants, losing billions on the way. It can't compete directly against competitors initially, but can market the hell out of any product and leverage its monopoly in one area to destroy markets, competitors and fair competition in other areas. The US government Sherman Act is a joke. Microsot gained a predatory monopoly on desktop PC's, laptops, notebooks, and has tried to destroy consoles, the internet, online search, cell phones and tablets. The further it goes from its base, the riskier its proposition. It has destroyed the technology market in the US, and has damaged competition in that area for at least a generation.

Re:StatCounter number is ALL devices, not tablets

[Maxo-Texas]

Not sure. Good android tablets have gotten really cheap. Like $135 for more capability than a $300 android tablet only two years ago.

Meanwhile apple and surface have remained expensive.

I own two android tables and have given two as gifts. Because they are inexpensive.

My daughter owns an apple-- because her company bought it for her.

I do have a couple friends who own an apple they bought with their own money. It's cool. They have Apple TV too. But as a couple, they earn close to $250k per year and live in a $400k house and have new cars. They are not rich- but they are very far from the average americans standard of living.