Microsoft's 1q 08 Results, Profitability!

[LordTheNightKnight]

mrstickball said:
The most important thing was:

#1. It was their most profitable H&E quarter, ever. With a cash-sink in the Zune, they still profited more than $70m more than the last profitable quarter they had, with Halo 2.

#2. They shipped 100% more consoles versus this quarter last year (0.9m vs. 1.8m). This shows they've cleared the warehouse/distribution channels, and are now shipping on-level with demand.

From now on, the key is being profitable due to more Halo sales (should double sales in the next 3 months vs. the 1 week Halo 3 launched @), and moving a crapload of profitable Xbox 360s. Thats the key. If they can ship 5-6m consoles this quarter, and make money on each one sold, they should maintain $50-150m of profits for the next 3 months.

Im not sure the Zune is a cash sink. When Microsoft mentioned the Zune as a reason they didn't make money last year, it was in R&D for the device. Now the Zune is out, and even though it isn't tearing up the charts, it's unlikely that it's sold at a loss. It doesn't have loads of software specifically made for it, so Microsoft would have to make sure each Zune is sold at a profit.