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Forums - Microsoft Discussion - Xbox Platform decreases Microsoft's gross margin by $400m for FY2013/14

Amazes me how many people dont know how to determine profit, loss, revenue, cost of revenue. No where does this information make it clear that the Xbox One portion of the Xbox business is losing money. Of course the cost of revenue for a product that costs more to produce is going to be higher. So they spent 2.1B more and made 1.7B more that doesnt mean they had a loss. One year I sell product that costs $10 to produce and I sell it for $50. The next year I sell a product for $70 that costs $50 to produce. Yes mot cost of revenue will be higher compared to the previous year.

 

Also the talk of unhappy shareholders is a fallacy anyway. It is something that a few shareholders with public voices have said and more so a few things that some speculative analysts have said. Most institutional investors dont give a rats ass.  Really they want MS to build the Xbox brand because it keeps MS in the minds of consumers, but just businesses. 



Its libraries that sell systems not a single game.

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In before the artards say "It doesn't matter because MS has all da moniez!"



DirtyP2002 said:
gooch_destroyer said:
This should be a wake up call for some people around here.


We need a wakeup-call for those claiming the Xbox One is not profitable after this "news".
We discussed this back in January btw.

http://gamrconnect.vgchartz.com/post.php?id=6000966

 

the Xbox division has never been profitable. The only reason why they keep it around is to invade your living room area.



gooch_destroyer said:
DirtyP2002 said:
gooch_destroyer said:
This should be a wake up call for some people around here.


We need a wakeup-call for those claiming the Xbox One is not profitable after this "news".
We discussed this back in January btw.

http://gamrconnect.vgchartz.com/post.php?id=6000966

 

the Xbox division has never been profitable. The only reason why they keep it around is to invade your living room area.

oh really?

Why do all the financial reports say otherwise?



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DirtyP2002 said:
gooch_destroyer said:

the Xbox division has never been profitable. The only reason why they keep it around is to invade your living room area.

oh really?

Why do all the financial reports say otherwise?

Think Goosh is being sarcastic there.



 

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I critisised the mods quite frequently over the last months, but I have to give credit to them now.
Adjusting the thread title like that was really important so some people here might actually get it.

Well done.



Imagine not having GamePass on your console...

Seece said:
DirtyP2002 said:
gooch_destroyer said:

the Xbox division has never been profitable. The only reason why they keep it around is to invade your living room area.

oh really?

Why do all the financial reports say otherwise?

Think Goosh is being sarcastic there.





Imagine not having GamePass on your console...

czecherychestnut said:
kowenicki said:
maverick40 said:
czecherychestnut said:
oldschoolfool said:
So,what does that all basically mean?


It means MS spent $2.1 billion to make $1.7 billion in revenue from Xbox, meaning that they lost $400 million last FY13/14 from the Xbox platform (XB1 and X360). Now given that X360 would be profitable during that period, the loss must come from the XB1, so in essense the loss due to XB1 is $400 million plus whatever profit X360 brought in during that period.

Exactly, basically unhappy shareholders are still unhappy with Xbox. Although, that hasn't changed since the original Xbox launched. 


I'm a shareholder.  I'm not unhappy.

you?

If you can find an unhappy MS shareholder, I'll show you a moron.

a 1 year return of up 35% and long time record highs?  lol

compared to... oh.... I dunno.  Im sure we can find some worhty examples.

 

But what has the Xbox platform contributed to the bolded? It doesn't matter that MS is going well, the question for most shareholders would be 'what does the Xbox platform contribute, and what would my return be if MS wasn't losing money the Xbox platform?".  For one the dividends would be higher if MS hadn't lost $400 million in the Xbox platform last year, as a shareholder I'd care about that. 


Well i had a 360 , which then lead me to buy a windows phone (for achievements) when it came time to upgrade, then when it came to getting a tablet, a Surface was the obvious choice.

I now also have a Xbox One ...i also have a laptop running windows 7.I have one account that i add money to which i can use across all those devices.

The point im making is , im now an exclusive microsoft user when it comes to technology and that started with xbox...If for whatever reason they were to sell the xbox brand.I Would know longer feel the need to have all my other devices , be from microsoft.

To me that is what the xbox brand does very well for Microsoft , more so maybe than straight up making profit itself.

Just my 2 cents anyway.



gooch_destroyer said:

the Xbox division has never been profitable. The only reason why they keep it around is to invade your living room area.

Which was why MS originally wanted to push the media features on the X1. The problem is that MS was trying to take a declining market and now, they're paying a dear price for that. Who needs a cablebox to connect it to the X1 when I can simply watch movies and shows on Hulu and Netflix on my PC and tablet?



Look at N4G comments please.
They really think MS lost 400m Dollar.



Imagine not having GamePass on your console...