M$ reports earning on 23 July, and it’s going to be interesting to see what kind of numbers are reported.  They have slashed 5000 jobs, and taken other cost cutting measures, so given the solid numbers posted by Intel, you’d think M$ would be bound to report solid numbers as well, unless the Wintel machines are fracturing more than we know.  Google and IMB also posted very solid numbers today, so it would seem that bell weather tech stocks are delivering the goods.  Of course, the key numbers that most on the site will be looking at, wrt to M$ will be the EDD numbers for 2008:

Revenue - $8.14 Bln

Profit - $426 Mln

8.7 million Xbox 360s Shipped

It’s going to be interesting to see how much the 360 price cut “cost” the revenue bottom-line, but it’s also important to keep in mind that Halo 3 was launched in that fiscal year, and it’s going to have an impact as well…just as Halo ODST will likely have on FY2010. 

Of course, we have the 9-month data from the last 10-Q in which m$ reported:

Entertainment and Devices Division

So, with nearly another 1.7 million consoles sold during this final quarter, M$ will have nearly 12 million consoles shipped for FY 2009, as compared to that 8.7 number for 2008, but at a reduced price to possibly counter the increased sales.  So far, EDD has spent $317 million on R&D, and that represents one of the most expensive cost increases, so depending on whether or not they dumped more increases like that into R&D, we will see if they return a stronger profit line.  As of the past 9-month period, they had only saved $60 on 360 platform cost, so it will be interesting to see the final reductions for the FY, since this will impact how much and the likelihood of another price cut sometime soon. 

The Outlook for 2009 was expected to be flat or slightly decreased, so they look to be ontrack to deliver at least that expectation, but could it perhaps be a bit more?  Looking at this current quarter, were their any upside surprises in games and etc?

I know DLC has probably been an upside with the launch of GTA and others for Fallout 3, not the mention weekly DLC like LIPs and GH DLs.  You’ve also got XBLA weekly numbers which have been increasing regularly, and finally, you’ve got increase subs for annual membership. The question is whether or not that will deliver an additional $127 million in profits for the quarter?

Whats the difference between revenue and profits?

night and day, and I'll assume you aren't kidding...

Revenue is gross

Profit is net

So, high revenue and low profit necessarily a bad thing, if you've got a solid reason for that.  If it's because you're ongoing cost of revenue is too high, that sucks.  By the same token, having high profit margins and decreasing revenue is also a bad thing, since it could signal a deteriorating business model.  steady growth in both categories is what you want...the clincher are one-time charges for things that boost the business model...these are normally viewed positively, since they help deliver potential game changer...for example, Natal.

The NPD numbers for June are bolstering my expectations on what M$ will report...I think it might be a smudge better than flat for the Y-O-Y numbers...it all depends on how much was acutally saved in shifting to the newer chipset and manufacturing processes.

Those numbers show how bad the price cut has hurt profits, but I guess without it things would of been worse. More OT - I expect a roughly Flat showing for the Y.O.Y numbers as even though the 360 is selling better this year, I cant see it doing as good this fall compared to last.

The increase of $317 million in R&D might have slight more of an effect as well...in addition to the increase in personnel headcounts...

Considering that every analysis of their yearly figures has indicated the Xbox 360 is more profitable than the EDD, it doesn't matter how the EDD performs because its pretty obvious the Xbox 360 is carrying the division.

Their net profits don't look too hot, considering the gross. Miniscule even.

They had a huge increase in R+D (over 300M?) but please, I don't want to disturb your propaganda work over here.

Jesus, I missed out the R&D costs, Im sorry.