Microsoft Loses $1.7bn Trying to Make Surface Relevant

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Microsoft has lost $1.7 billion trying to make the Surface a hit

 

"Microsoft’s Surface Pro 3 tablet might finally be gaining some traction for Microsoft in the tablet market, but the whole Surface venture has come at an enormous cost. Computerworld notices that Microsoft revealed in an 8-K statement filed with the Securities and Exchange Commission this week that it has lost $1.7 billion on its Surface line of tablets so far, which is nearly double the $900 million write down that Microsoft took last year on unsold Surface inventory. 

What’s actually really remarkable about this is that Microsoft makes such an insane amount of money that it can afford to shrug off its multiple money-losing consumer electronics bombs. Microsoft’s operating income last quarter was $6.48 billion and its earnings per share only narrowly missed Wall Street expectations after posting better-than-expected earnings the quarter before. Unlike companies such as HTC that live and die on device sales, Microsoft can afford to keep lighting money on fire for the foreseeable future until it finally produces a hit."

Source: http://news.yahoo.com/microsoft-lost-1-7-billion-trying-surface-hit-000019595.html

 

What are your thoughts? Is this a money pit for MS? Should they drop Surface and stick to software and services, especially since Nadella wants the company to focus on those more than hardware?