MSFT Q1 2015 Results: $23bn rev, $5.8bn profit and 2.4m Xbox shipped. Analystst estimates easily beaten.

[binary solo]

nanarchy said:

Kyo_86 said:

Aura7541 said:

Kyo_86 said:

"Xbox Platform revenue increased $538 million or 58%"  and "Xbox Platform cost of revenue increased $623 million or 139%"

So the cost of revenue increase more than the reveue itself. Not good.

Well that's awkward...

OT: Glad to see that MS's cloud business is doing well

X1 shipment numbers aren't bad, but wasn't a good fraction of shipments geared towards Tier 2 countries and China?

It means that more they sell more money they lose.

No it means the costs associated with releases in more countries is expensive and not unexpected. Selling more would actually be better for them as many of those costs are fixed and hence don't reoccur with increased sales.

Yeah, it was a loss making quarter for Xbox, but that's to be expected. Given holiday sales Q2 should be a profit-making quarter for Xbox. The big question is whther Q3 and 4 will be profit making quarters for Xbox and what the year as a whole will look like in terms of profiut and loss. Clearly the profit margin for 360 at present is higher than for Xb one and as 360 diminishes and Xb one becomes almost 100% of Xbox's revenue source the ongoing profitability of the Xbox brand is in question. If MS tries to do more things to increase Xb one sales (more free games (esp. free 3rd party games), longer periods of free XBL gold with Xb one purchase) the margins will take a substantial hit and profitability might be hard to come by. As long as Surface keeps up its margins the division itself will look healthy, which might prevent anti-Xbox shareholders from complaining too much.