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Forums - Microsoft - Microsoft will make a net profit on the Xbox brand before the 360 is done?

Its amazing how the Xbox 360 sales have grown, especially software!

Week of December 08th 2006:

Software: 1,459,134 (23,956,238)

Hardware: 6,677,164

Week of December 07th 2007:

Software: 3,636,865 (77,922,437)

Hardware: 14,430,221

Week of December 5th 2008:

Software: 5,663,626 (186,299,150)

Hardware: 24,709,486

FY* Sony** Nintendo Microsoft
1998 974,000,000 629,000,000
1999 1,130,000,000 645,000,000
2000 730,000,000 421,000,000
2001 -409,000,000 726,000,000
2002 623,000,000 800,000,000 -750,000,000
2003 939,000,000 560,000,000 -1,191,000,000
2004 650,000,000 316,000,000 -1,215,000,000
2005 404,000,000 777,000,000 -485,000,000
2006 75,000,000 894,000,000 -1,262,000,000
2007 -1,969,000,000 1,489,000,000 -1,892,000,000
2008 -1,265,000,000 2,480,000,000 426,000,000
2009 51,000,000 1,026,000,000 178,000,000
Totals 1,953,000,000 10,762,000,000   -6,191,000,000

 2009 is currently blank, however we know that Xbox revenues have increased substantially. 2008 saw more than twice the software sold on the platform than 2007, it doubled from 50 to 100 million sold and it is expected to increase by another 50% at least this year. Between Xbox Live gold, Xbox Arcade, Xbox movies/music and software royalties more than one and a half billion dollars of revenue will pass through their hands this year, even if they didn't sell another console or 1st party game for the rest of the year.

This generation is a funny one, the Xbox 360 starting a year earlier is a significant reason as to why I make such a bold claim. If one compares the numbers above between the Xbox 360 and PS3 you can see the losses are relatively equal. The difference in this case is that the Xbox 360 will get at least one extra year at the height of maturity. That extra year is significant because at that time the Xbox 360 will likely be earning the company more than a billion dollars profit per year, the Microsoft executives knew this, which is why they weren't concerned over the 1B RROD charge. Furthermore this generation is expected to remain relevant far longer than the previous generation of consoles so the Xbox 360 will be extremely profitable out past 2011.

For me to be correct the Xbox 360 has 4 years + the previous years financial data to make back the bulk of $6B dollars. 2008 Financials, 2009, 2010, 2011, 2012 (assuming the Nextbox is released late 2011 with one final year for the previous flagship to keep the spotlight). The question really is this: Can the Xbox 360 earn more than a billion dollars per year profit on average for the next 4 years?

 

 



Tease.

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How do we get the net revenue of the 360 if Microsoft only release data for their gaming division as a whole? I'm pretty certain there is a lot of blacksheeps that got lumped into it that has nothing to do with the 360 right?




I want to say no, and for those 4 years it's extremely unlikely to make back those $6+ billion. If it has a longer added lifetime (which could happen due to the recession), it could get close or *gasp* surpass it?

The one special thing the 360 has going for it in terms of profit are the Live fees, that alone is like selling 2-4 additional games per Live user a year (minus the costs of course).

Maybe a better answer will be possible after the earnings release, but expect a "no" ;)

 



My Mario Kart Wii friend code: 2707-1866-0957

Probably not this generation as they mainly focused on locking down the hardcore base and taking marketshare away from Sony. Their next system should be more mass market friendly and will be the one that makes the profits. The 360 was used to mainly break into the market and become a legit console provider because they were close to the verge of irrelevancy back in 2005.



We'll never know since the 360 is hidden in the EDD.



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Realistically, probably not ...

If Microsoft plans to release a new console sometime between 2010 and 2012 then you would probably start to see large R&D expenses in 2009 or 2010 which would (greatly) reduce overall profitability.



Man, nintendo knows how to make money. I want to see them lose money just once...



Did they not make 178,000,000 last quater? Thats included into 09 right?! :S



 

like always i should say ( go 360 )



seece said:
Did they not make 178,000,000 last quater? Thats included into 09 right?! :S

That table is "old" and does not include the last quarter. Your number is correct according to this page.

 



My Mario Kart Wii friend code: 2707-1866-0957