ethomaz said:
thx1139 said:
Why do people think that due to a greater increase in the cost of revenue then the platform revenue increased that the Xbox portion of MS business lost money. You cant just that. Lets put it in a way people can understand, You own a lemonade stand and your old flavor which you sell for $1 per glass is now kind of old and people starting to move on. That lemonade costs you 10 cents per glass to make. You still sell 100 glasses in a day. You introduce a new flavor and because of the new not mass produced ingredients you charge $2 per glass for this new lemonade. For now this lemonade costs $1 per glass just to make. So see how your cost of revenue increased, but you still profited.
The moral of the story is you cant determine profitability or loss solely on cost of revenue increasing more then revenue increasing. You need total expenses and total revenue to determine profitability.
From the report
Computing and Gaming Hardware Revenue $2.45 Billion (Surface Revenue was $908 million)
Computing and Gaming Hardware Gross Margin $479 Million (That is a profit)
Game Software is in another Segment
Devices and Consumer Other Revenue $1.809 Billion
Devices and Consumer Gross Margin $312 Million (That is a profit) |
Gross Margin is not profit.
Gross Margin doesn't account for several expenses (selling, administrative, etc) who makes part of the profit.
PS. It is the same "error" I did in the PS thread with my Division charts... I just used it because there is no other info... and some guys get mad due that fact.
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Gross Margin is the closest we will have to an individual unit if the business profit. After all it is one company with several organizational segments. Not several companies.
Administrative and Sales functions directly related to those segments are indeed included in those number. There are some things that cover the whole company and for those I present you this information from the Quarterly Report. These are shared across all segments.
And FYI here it is
Revenue
Corporate and Other -$43 million
Gross Margin
Corporate and Other -$64 million
