In just 8 months the Xbone lost MS 400 million dollars

  • 100 results
  • 1
  • 2
  • 3
#1 Posted by Gue1 (9500 posts) -

http://www.pcworld.com/article/2456906/as-hardware-kills-microsoft-profits-ceo-nadella-seeks-comfort-in-software.html

http://www.dualshockers.com/2014/08/08/xbox-one-lost-microsoft-400000000-during-last-fiscal-year/

"Computing and Gaming Hardware revenue increased $3.2 billion or 49%, primarily due to higher revenue from the Xbox Platform and Surface. Xbox Platform revenue increased $1.7 billion or 34%, due mainly to sales of Xbox One, which was released in November 2013, offset in part by a decrease in sales of Xbox 360. We sold 11.7 million Xbox consoles during fiscal year 2014 compared with 9.8 million Xbox consoles during fiscal year 2013. Surface revenue increased $1.3 billion or 157%, due mainly to a higher number of devices and accessories sold.

Computing and Gaming Hardware gross margin decreased slightly, due to a $3.2 billion or 59% increase in cost of revenue, offset in part by higher revenue. Xbox Platform cost of revenue increased $2.1 billion or 72%, due mainly to higher volumes of consoles sold and higher costs associated with Xbox One. Surface cost of revenue increased $970 million or 51%, due mainly to a higher number of devices and accessories sold, offset in part by a charge for Surface RT inventory adjustments of approximately $900 million in fiscal year 2013."

source

This is on a gross margin basis as well so the operating loss is probably much higher.

Between the OG Xbox disaster, RROD and now the Xbone MS has never made a dime out of the Xbox brand. So why do they continue making consoles anyway? What is driving MS to keep hemorrhaging money through Xbox? Because I'm pretty sure they are not doing it out of their love for gaming.

#2 Posted by freedomfreak (39166 posts) -

Time to start selling some buildings.

#3 Posted by Blabadon (25934 posts) -

They've never made a dime? Really?

Seriously, anyone who's a PlayStation gamer should be happy Microsoft entered gaming or you probably wouldn't have even been able to use the XMB during gameplay.

#4 Posted by GamersJustGame (201 posts) -

@Gue1 said:

http://www.pcworld.com/article/2456906/as-hardware-kills-microsoft-profits-ceo-nadella-seeks-comfort-in-software.html

http://www.dualshockers.com/2014/08/08/xbox-one-lost-microsoft-400000000-during-last-fiscal-year/

"Computing and Gaming Hardware revenue increased $3.2 billion or 49%, primarily due to higher revenue from the Xbox Platform and Surface. Xbox Platform revenue increased $1.7 billion or 34%, due mainly to sales of Xbox One, which was released in November 2013, offset in part by a decrease in sales of Xbox 360. We sold 11.7 million Xbox consoles during fiscal year 2014 compared with 9.8 million Xbox consoles during fiscal year 2013. Surface revenue increased $1.3 billion or 157%, due mainly to a higher number of devices and accessories sold.

Computing and Gaming Hardware gross margin decreased slightly, due to a $3.2 billion or 59% increase in cost of revenue, offset in part by higher revenue. Xbox Platform cost of revenue increased $2.1 billion or 72%, due mainly to higher volumes of consoles sold and higher costs associated with Xbox One. Surface cost of revenue increased $970 million or 51%, due mainly to a higher number of devices and accessories sold, offset in part by a charge for Surface RT inventory adjustments of approximately $900 million in fiscal year 2013."

source

This is on a gross margin basis as well so the operating loss is probably much higher.

Between the OG Xbox disaster, RROD and now the Xbone MS has never made a dime out of the Xbox brand. So why do they continue making consoles anyway? What is driving MS to keep hemorrhaging money through Xbox? Because I'm pretty sure they are not doing it out of their love for gaming.

You do realize the PS3 caused sony to go 6 billion in debt.

#5 Posted by Bigboi500 (29342 posts) -

Didn't know things were that bad for the ole Xbone.

#6 Edited by Floppy_Jim (25594 posts) -

This is quite normal for consoles not named Wii and PS4.

#7 Posted by evildead6789 (7497 posts) -

pushing that kinect was the dumbest thing to do

and as long as the cloud doesn't show any promise, they should make it cheaper than the ps4 since the ps4 is a stronger system.

They should have asked 350$ for this system , and made the kinect optional.

Dear old bill leaving the company shows in the business decision they're making, sad for lemmings, sad for microsoft

#8 Posted by silversix_ (14072 posts) -

Good news. The more money MS loses the less greedy they become by offering deals worth a crap and maybe only maybe they'll focus on games like they did with the original Xbox and 360 in its first 2-3 years

#9 Edited by GrenadeLauncher (4091 posts) -

What a shame.

#10 Posted by slimdogmilionar (478 posts) -

@Gue1:

Good news. The more money MS loses the less greedy they become by offering deals worth a crap and maybe only maybe they'll focus on games like they did with the original Xbox and 360 in its first 2-3 years

Yep I'm glad Sony is winning because now M$ has no choice but to focus on making the system more appealing, Sony continues to give no matter how bad their finances look. But 400 billion is not bad considering all three companies are losing money on gaming, but M$ has the biggest revenue out of the 3. The gaming market is too big to ignore M$ will continue to want a piece of the pie as long as gaming is a multi-billion dollar market, the same way Sony didn't abandon PS3 when they lost billions on it all last gen, they just came up with great ideas to make the system more appealing.

#11 Edited by B4X (3621 posts) -

@evildead6789 said:

pushing that kinect was the dumbest thing to do

and as long as the cloud doesn't show any promise, they should make it cheaper than the ps4 since the ps4 is a stronger system.

They should have asked 350$ for this system , and made the kinect optional.

Dear old bill leaving the company shows in the business decision they're making, sad for lemmings, sad for microsoft

10 billion dollar profits in the last 8 months says hi?

Hyperbole much?

Edit: I do agree with your assessment of X1 though.

#12 Posted by B4X (3621 posts) -

Time to start selling some buildings.

low blow

#13 Posted by nintendoboy16 (26272 posts) -

@Gue1 said:

Between the OG Xbox disaster, RROD and now the Xbone MS has never made a dime out of the Xbox brand. So why do they continue making consoles anyway? What is driving MS to keep hemorrhaging money through Xbox? Because I'm pretty sure they are not doing it out of their love for gaming.

Because, like Sony, Microsoft has other business ventures to help them out.

#14 Posted by geniobastardo (1294 posts) -

Time to sell their employees.

#15 Posted by MBirdy88 (7704 posts) -

@Blabadon said:

They've never made a dime? Really?

Seriously, anyone who's a PlayStation gamer should be happy Microsoft entered gaming or you probably wouldn't have even been able to use the XMB during gameplay.

there is truth in this.... xbox brand was very important in bringing consoles out of the stone age... I hate to think what they would be like now without them.

#16 Edited by Shewgenja (8466 posts) -

I'll be so glad when an actual gaming company takes Microsofts spot. Let's be honest here, they are only capable of staying in the console business because of their ridiculous billyunz. I bet NVidia or Samsung could make some badass consoles. Microsoft is like that jacked up pickup truck that's backed up into its parking space all half-ass. Just doesn't belong and they ignorant the place up.

#17 Posted by Desmonic (13418 posts) -

Some sort of loss was expected, given that the shipments slowed down like crazy (you can still get new Day One editions for example, which makes no damn sense).

Besides anything below a single billion is still pretty manageable for big companies like MS and Sony. Anything more than that and it starts being an issue, as Sony now knows.

#18 Posted by delta3074 (17897 posts) -

@Gue1 said:

http://www.pcworld.com/article/2456906/as-hardware-kills-microsoft-profits-ceo-nadella-seeks-comfort-in-software.html

http://www.dualshockers.com/2014/08/08/xbox-one-lost-microsoft-400000000-during-last-fiscal-year/

"Computing and Gaming Hardware revenue increased $3.2 billion or 49%, primarily due to higher revenue from the Xbox Platform and Surface. Xbox Platform revenue increased $1.7 billion or 34%, due mainly to sales of Xbox One, which was released in November 2013, offset in part by a decrease in sales of Xbox 360. We sold 11.7 million Xbox consoles during fiscal year 2014 compared with 9.8 million Xbox consoles during fiscal year 2013. Surface revenue increased $1.3 billion or 157%, due mainly to a higher number of devices and accessories sold.

Computing and Gaming Hardware gross margin decreased slightly, due to a $3.2 billion or 59% increase in cost of revenue, offset in part by higher revenue. Xbox Platform cost of revenue increased $2.1 billion or 72%, due mainly to higher volumes of consoles sold and higher costs associated with Xbox One. Surface cost of revenue increased $970 million or 51%, due mainly to a higher number of devices and accessories sold, offset in part by a charge for Surface RT inventory adjustments of approximately $900 million in fiscal year 2013."

source

This is on a gross margin basis as well so the operating loss is probably much higher.

Between the OG Xbox disaster, RROD and now the Xbone MS has never made a dime out of the Xbox brand. So why do they continue making consoles anyway? What is driving MS to keep hemorrhaging money through Xbox? Because I'm pretty sure they are not doing it out of their love for gaming.

'Because I'm pretty sure they are not doing it out of their love for gaming.'

None of the big 3 are doing it because they love gaming, they do it because they love Money MS clearly feel that at some point they will make there money back, so do SONY as they lost 6 billion on the Ps3 yet they still released the PS4.

Why do you care anyway? these company's don't give a monkeys about you or your opinion they only care about the Monies they can extract from you.

#19 Posted by delta3074 (17897 posts) -

This is quite normal for consoles not named Wii and PS4.

This is the correct answer.

#21 Posted by foxhound_fox (87683 posts) -

And Windows made them $400 gazillion.

#22 Posted by tormentos (17110 posts) -

You do realize the PS3 caused sony to go 6 billion in debt.

Yes and the PS3 had blu-ray and more expensive hardware than the xbox 360,not cheap ass hardware lie MS has this gen,it was probably the loss of directly,i mean they spend $100 millions just re shaping the controller which many believe the xbox 360 one is better.

Any way i call it for months MS was losing money on the xbox and hiding it,this get out now because they have to report to US if it wasn't for that they it would have pass unkown and cover by Android money patent or some other MS cash cow.

#23 Posted by Desmonic (13418 posts) -

And Windows made them $400 gazillion.

One could make the argument that this situation just gives more reason/power to the investors that want/wanted to sell the Xbox brand :P Though I hope it doesn't happen, since I don't see who could buy it and make a decent job with it.

#24 Posted by Heil68 (43462 posts) -

Zoinks, Lems can't catch a break.

#25 Posted by Alcapello (779 posts) -

Time to beg for Bloodborne.

Come bloodborne, Xbox Off is what everyone will be saying when it start to malfunction on on you.

Forget about japan sales, forget about china, salvage what you can from the lemming here in more subscriptions...EA was a nice start keep em option coming.

The gen is over like someone mentions earlier this week.

#26 Posted by Sollet (7342 posts) -

Ouch, don't worry those 33 countries and MC:C will save the day!

#27 Posted by Salt_The_Fries (8367 posts) -

@Gue1 said:

http://www.pcworld.com/article/2456906/as-hardware-kills-microsoft-profits-ceo-nadella-seeks-comfort-in-software.html

http://www.dualshockers.com/2014/08/08/xbox-one-lost-microsoft-400000000-during-last-fiscal-year/

"Computing and Gaming Hardware revenue increased $3.2 billion or 49%, primarily due to higher revenue from the Xbox Platform and Surface. Xbox Platform revenue increased $1.7 billion or 34%, due mainly to sales of Xbox One, which was released in November 2013, offset in part by a decrease in sales of Xbox 360. We sold 11.7 million Xbox consoles during fiscal year 2014 compared with 9.8 million Xbox consoles during fiscal year 2013. Surface revenue increased $1.3 billion or 157%, due mainly to a higher number of devices and accessories sold.

Computing and Gaming Hardware gross margin decreased slightly, due to a $3.2 billion or 59% increase in cost of revenue, offset in part by higher revenue. Xbox Platform cost of revenue increased $2.1 billion or 72%, due mainly to higher volumes of consoles sold and higher costs associated with Xbox One. Surface cost of revenue increased $970 million or 51%, due mainly to a higher number of devices and accessories sold, offset in part by a charge for Surface RT inventory adjustments of approximately $900 million in fiscal year 2013."

source

This is on a gross margin basis as well so the operating loss is probably much higher.

Between the OG Xbox disaster, RROD and now the Xbone MS has never made a dime out of the Xbox brand. So why do they continue making consoles anyway? What is driving MS to keep hemorrhaging money through Xbox? Because I'm pretty sure they are not doing it out of their love for gaming.

You do realize the PS3 caused sony to go 6 billion in debt.

6 frigging billion, do you realize that, cows?

#28 Edited by HalcyonScarlet (4040 posts) -

@Gue1 said:

Between the OG Xbox disaster, RROD and now the Xbone MS has never made a dime out of the Xbox brand. So why do they continue making consoles anyway? What is driving MS to keep hemorrhaging money through Xbox? Because I'm pretty sure they are not doing it out of their love for gaming.

Sony haven't made a lot on Playstation either. PS3 at best they probably broke even if they're lucky but it's highly doubtful. Even during the PS2 period I heard they only ones making any real money was Nintendo (likely through their handhelds).

#29 Posted by Daious (1120 posts) -

I figured the layoffs were somewhat related.

#30 Edited by HalcyonScarlet (4040 posts) -
@gamersjustgame said:

You do realize the PS3 caused sony to go 6 billion in debt.

Yes and the PS3 had blu-ray and more expensive hardware than the xbox 360,not cheap ass hardware lie MS has this gen,it was probably the loss of directly,i mean they spend $100 millions just re shaping the controller which many believe the xbox 360 one is better.


It doesn't really end there. The R&D for the CELL was costly as was the plants and no matter how good the idea was as hardware, it was a terrible idea for gaming. The costs then trickled down into development where some developers considered it worse than the PS2 to develop for and as bad as the NES. So for business it starts to add costs and an obscene increase in development time.

Blu Ray was put there as a Trojan horse. It was barely ever proved critical for gaming last gen. Sony needed it to win a format war and in hindsight I'm not sure was worth it. Blu Ray hasn't taken off like DVD has and people are more interested in video files and streaming now.

Having stupid hardware ideas is just as bad as cheap hardware. Also I don't think the 360 had 'cheap hardware', it was a lack of experience, it was MSs first time customising a hardware device, something Sony has vast experience in and excels at, it is their forte. Nintendo has also been doing this for a long time.

#31 Posted by starwolf474 (552 posts) -

This is pocket change for Microsoft and completely normal for most consoles to lose money in their first few months. Plus, it is absolutely nothing compared to what Sony lost last gen yet they are still making consoles.

I don't understand why cows want Microsoft out of the console market so badly. If you like the PlayStation brand more and have no interest in Xbox consoles, that's fine, you don't have to buy them, but to want them out of the console business is just downright stupid.

Even if you only own PlayStation consoles, Microsoft being in the console market has still benefited you. Microsoft is responsible for things like taking online gaming out of the stoneage and showing Sony how to make a good online service so they could copy it, getting western developers that used to only make games for PC to start making games for Xbox which then led to them also making games for PlayStation, creating achievements which Sony copied with trophies, creating the most comfortable controller ever which led to Sony finally changing their controller design and making a better controller which was heavily influenced by the 360 pad.

Plus, by providing competition to Sony and kicking their ass last gen, it humbled Sony and forced them to work harder to win back their lost marketshare. Remember how arrogant Sony was when the PS3 launched? Remember how they thought you should get a second job to afford their console or how they wanted to make clear that the "PS3 was not a game machine" or how they did not want to make an easy to program for console? You can thank Microsoft for them changing that when it was time for the PS4.

#32 Edited by edwardecl (2112 posts) -

The thing is you can't look at the console as just losing money... they are using the Xbox brand to push their other services such as Skype and their Azure cloud services as well as expanding or potentially expanding the services to areas such as IPTV. If they don't make complimentary services then people like Google are going to crucify them in the online arena more then they already are.

Sony do the same, they use PS brand to push their own Bluray format and their own films, they are also pushing their own online music and TV services, there is probably more to come as well. Think of it this way as well, every time Microsoft sells a console or game on Bluray disc they are paying Sony royalties... so the pushing the PS3 for the Bluray format really paid off big time.

#33 Posted by Shewgenja (8466 posts) -

6 frigging billion, do you realize that, cows?

Keep that time machine well-oiled. You're gonna need it. Living in the past through Gen 8 will serve you well.

#34 Posted by 04dcarraher (19254 posts) -

The thing is you can't look at the console as just losing money... they are using the Xbox brand to push their other services such as Skype and their Azure cloud services as well as expanding or potentially expanding the services to areas such as IPTV. If they don't make complimentary services then people like Google are going to crucify them in the online arena more then they already are.

Sony do the same, they use PS brand to push their own Bluray format and their own films, they are also pushing their own online music and TV services, there is probably more to come as well. Think of it this way as well, every time Microsoft sells a console or game on Bluray disc they are paying Sony royalties... so the pushing the PS3 for the Bluray format really paid off big time.

They aren't paying Sony royalties more then one company had/has bluray patents, and no one company owns it, Sony does not "own" Blu-ray in any way shape portion or form, its a bunch of companies that belong to a pool of patents. The only way MS would be paying Sony would be if they were to buy Sony bluray drives which isnt going to happen.

#35 Posted by edwardecl (2112 posts) -

@edwardecl said:

The thing is you can't look at the console as just losing money... they are using the Xbox brand to push their other services such as Skype and their Azure cloud services as well as expanding or potentially expanding the services to areas such as IPTV. If they don't make complimentary services then people like Google are going to crucify them in the online arena more then they already are.

Sony do the same, they use PS brand to push their own Bluray format and their own films, they are also pushing their own online music and TV services, there is probably more to come as well. Think of it this way as well, every time Microsoft sells a console or game on Bluray disc they are paying Sony royalties... so the pushing the PS3 for the Bluray format really paid off big time.

They aren't paying Sony royalties more then one company had/has bluray patents, and no one company owns it, Sony does not "own" Blu-ray in any way shape portion or form, its a bunch of companies that belong to a pool of patents. The only way MS would be paying Sony would be if they were to buy Sony bluray drives which isnt going to happen.

They still get royalties from it even if they don't outright own it.

#36 Edited by musicalmac (22902 posts) -

Nice to see it confirmed, I've questioned the profitability of the consoles for some time now.

#37 Posted by GrenadeLauncher (4091 posts) -

Even if you only own PlayStation consoles, Microsoft being in the console market has still benefited you. Microsoft is responsible for things like taking online gaming out of the stoneage and showing Sony how to make a good online service so they could copy it, getting western developers that used to only make games for PC to start making games for Xbox which then led to them also making games for PlayStation, creating achievements which Sony copied with trophies, creating the most comfortable controller ever which led to Sony finally changing their controller design and

Cheevos and online. Woo.

making a better controller which was heavily influenced by the 360 pad.

lol what

#38 Posted by shawn30 (4364 posts) -

I'll be so glad when an actual gaming company takes Microsofts spot. Let's be honest here, they are only capable of staying in the console business because of their ridiculous billyunz. I bet NVidia or Samsung could make some badass consoles. Microsoft is like that jacked up pickup truck that's backed up into its parking space all half-ass. Just doesn't belong and they ignorant the place up.

Don't agree at all. OG Xbox wasn't bad, but not great. 360 ushered in console multiplayer, the infrastructure and future of it. The One's design is up for debate, but far from bad. Xbox 2 will be a beast, no doubt lessons learned. Losing 400 million the first year your console debuts sucks, but if you have to take a loss do it in year one. PS4 has lost 78 million for Sony. Lets see what year 2 brings.

#39 Posted by Shewgenja (8466 posts) -

@shawn30 said:

@Shewgenja said:

I'll be so glad when an actual gaming company takes Microsofts spot. Let's be honest here, they are only capable of staying in the console business because of their ridiculous billyunz. I bet NVidia or Samsung could make some badass consoles. Microsoft is like that jacked up pickup truck that's backed up into its parking space all half-ass. Just doesn't belong and they ignorant the place up.

Don't agree at all. OG Xbox wasn't bad, but not great. 360 ushered in console multiplayer, the infrastructure and future of it. The One's design is up for debate, but far from bad. Xbox 2 will be a beast, no doubt lessons learned. Losing 400 million the first year your console debuts sucks, but if you have to take a loss do it in year one. PS4 has lost 78 million for Sony. Lets see what year 2 brings.

Yeah, but what made the first XBox so great and the 360 start out strong is long gone. Allard, Blackley and the other talent at MS that was truly gamer-centric left and the holes in leadership left by them were filled by people who really don't get gaming. I'd be lying if I told you I had any kind of confidence in Spencer. His background is not in gaming and he was responsible for, ironically, cutting the $400 million check for the NFL at the onset of the XBone.

Just imagine that, if you will. Had MS and Spencer, specifically, not pursued that deal then the Entertainment Studios might even still be open. Heck, the Kinect wouldn't have had to be debundled for a proper price cut. Set aside that I am vehemently anti-XBox for a moment and just let some of that sink in. The XBone as we knew it (without the DRM, aside) would still be a thing if it weren't for Spencer and the NFL. That cannot be an easy pill to swallow.

#40 Edited by jsmoke03 (12756 posts) -

yea, selling at a loss and recouping through software hasnt worked out for them has it?

#41 Edited by shawn30 (4364 posts) -

@Shewgenja said:

@shawn30 said:

@Shewgenja said:

I'll be so glad when an actual gaming company takes Microsofts spot. Let's be honest here, they are only capable of staying in the console business because of their ridiculous billyunz. I bet NVidia or Samsung could make some badass consoles. Microsoft is like that jacked up pickup truck that's backed up into its parking space all half-ass. Just doesn't belong and they ignorant the place up.

Don't agree at all. OG Xbox wasn't bad, but not great. 360 ushered in console multiplayer, the infrastructure and future of it. The One's design is up for debate, but far from bad. Xbox 2 will be a beast, no doubt lessons learned. Losing 400 million the first year your console debuts sucks, but if you have to take a loss do it in year one. PS4 has lost 78 million for Sony. Lets see what year 2 brings.

Yeah, but what made the first XBox so great and the 360 start out strong is long gone. Allard, Blackley and the other talent at MS that was truly gamer-centric left and the holes in leadership left by them were filled by people who really don't get gaming. I'd be lying if I told you I had any kind of confidence in Spencer. His background is not in gaming and he was responsible for, ironically, cutting the $400 million check for the NFL at the onset of the XBone.

Just imagine that, if you will. Had MS and Spencer, specifically, not pursued that deal then the Entertainment Studios might even still be open. Heck, the Kinect wouldn't have had to be debundled for a proper price cut. Set aside that I am vehemently anti-XBox for a moment and just let some of that sink in. The XBone as we knew it (without the DRM, aside) would still be a thing if it weren't for Spencer and the NFL. That cannot be an easy pill to swallow.

Easy pill to swallow, no. But minus a time machine Phil has to deal with the Xbox One as it is. He unbundled Kinect to drop the price, but didn't halt Kinect enhancements or apps like Xbox Fitness, Upload Studio, Twitch, ect for those who use Kinect. He's doubling down on games, which when you look at Killer Instinct Season 2, Scalebound, Halo:MMC, Sunset Overdrive, Forza Horizon, Gears of War 4, Crackdown, Quantum Break, and Halo 5 as known games coming in the next 2 years he's on a far better path than they were on. When you hear his interviews it seems like he gets it. Look, the Playstation 4 is selling like a monster as Sony has done a great job all the way around with it. The One will struggle, especially overseas, but Halo 5 and Gears, along with price drops and other titles will likely see a long-term profit for the console. Everyone eats it year one. Years two, three, and for, as production costs drop, install bases increase, and Live subscriptions grow will see the One doing just fine. There will be a Xbox 2, and they will have learned the painful lessons from this gen, even as it will likely gross a profit when its all said and done minus Kinect and RROD. If there's a PS4 considering Sony's company wide dire situation and the failure of the PS3 to the tune of 6 billion, no way MS doesn't do a Xbox 2 with the hard lessons learned IMHO.

I still do not think it needs to be stressed enough that the 360 and PS3 sold 85+ million over seven years, and 8 months into this gen PS4 sits at 9 million, the One at 5. A shit-ton of fans have not upgraded yet. And no matter where you sell your consoles the most, doesn't meant you can't sell great their again. MS will lean on the US and UK all gen long, and gain a nice chunk of sales even as it will likely be millions beHIND the PS4 in sales. At least that's what I think.

#42 Posted by Shewgenja (8466 posts) -

@shawn30 said:

Easy pill to swallow, no. But minus a time machine Phil has to deal with the Xbox One as it is. He unbundled Kinect to drop the price, but didn't halt Kinect enhancements or apps like Xbox Fitness, Upload Studio, Twitch, ect for those who use Kinect. He's doubling down on games, which when you look at Killer Instinct Season 2, Scalebound, Halo:MMC, Sunset Overdrive, Forza Horizon, Gears of War 4, Crackdown, Quantum Break, and Halo 5 as known games coming in the next 2 years he's on a far better path than they were on. When you hear his interviews it seems like he gets it. Look, the Playstation 4 is selling like a monster as Sony has done a great job all the way around with it. The One will struggle, especially overseas, but Halo 5 and Gears, along with price drops and other titles will likely see a long-term profit for the console. Everyone eats it year one. Years two, three, and for, as production costs drop, install bases increase, and Live subscriptions grow will see the One doing just fine. There will be a Xbox 2, and they will have learned the painful lessons from this gen, even as it will likely gross a profit when its all said and done minus Kinect and RROD. If there's a PS4 considering Sony's company wide dire situation and the failure of the PS3 to the tune of 6 billion, no way MS doesn't do a Xbox 2 with the hard lessons learned IMHO.

I still do not think it needs to be stressed enough that the 360 and PS3 sold 85+ million over seven years, and 8 months into this gen PS4 sits at 9 million, the One at 5. A shit-ton of fans have not upgraded yet. And no matter where you sell your consoles the most, doesn't meant you can't sell great their again. MS will lean on the US and UK all gen long, and gain a nice chunk of sales even as it will likely be millions beHIND the PS4 in sales. At least that's what I think.

Either XBone will be Microsofts Dreamcast or it will be their Master System. Just depends on their level of commitment, I suppose.

#43 Posted by ni6htmare01 (917 posts) -

@Gue1 said:

http://www.pcworld.com/article/2456906/as-hardware-kills-microsoft-profits-ceo-nadella-seeks-comfort-in-software.html

http://www.dualshockers.com/2014/08/08/xbox-one-lost-microsoft-400000000-during-last-fiscal-year/

"Computing and Gaming Hardware revenue increased $3.2 billion or 49%, primarily due to higher revenue from the Xbox Platform and Surface. Xbox Platform revenue increased $1.7 billion or 34%, due mainly to sales of Xbox One, which was released in November 2013, offset in part by a decrease in sales of Xbox 360. We sold 11.7 million Xbox consoles during fiscal year 2014 compared with 9.8 million Xbox consoles during fiscal year 2013. Surface revenue increased $1.3 billion or 157%, due mainly to a higher number of devices and accessories sold.

Computing and Gaming Hardware gross margin decreased slightly, due to a $3.2 billion or 59% increase in cost of revenue, offset in part by higher revenue. Xbox Platform cost of revenue increased $2.1 billion or 72%, due mainly to higher volumes of consoles sold and higher costs associated with Xbox One. Surface cost of revenue increased $970 million or 51%, due mainly to a higher number of devices and accessories sold, offset in part by a charge for Surface RT inventory adjustments of approximately $900 million in fiscal year 2013."

source

This is on a gross margin basis as well so the operating loss is probably much higher.

Between the OG Xbox disaster, RROD and now the Xbone MS has never made a dime out of the Xbox brand. So why do they continue making consoles anyway? What is driving MS to keep hemorrhaging money through Xbox? Because I'm pretty sure they are not doing it out of their love for gaming.

You do realize the PS3 caused sony to go 6 billion in debt.

But I'm sure both PS1 and PS2 made Sony a lot of money

#44 Edited by Prawephet (143 posts) -

@Shewgenja: Samsung? Really? I guess if you want an adware bloated, slow, piece of shit then Samsung would make a good console. Did I mention cheap parts falsely advertised as being faster than they actually are?

Here the other problem with bringing Samsung in. Those stupid Korean businesses don't run sustainable business models. Those dumb bastards would launch some uber console at $100, drop all support for the thing 6 months after launch and ruin the entire gaming industry. Just like they(Samsung and lg) did with the television industry. Keep Samsung out of my gaming.

#45 Posted by AmazonAngry (945 posts) -

This is the end of the xbox.

#46 Posted by LJS9502_basic (150329 posts) -

@jsmoke03 said:

yea, selling at a loss and recouping through software hasnt worked out for them has it?

You have to have a decent console base to recoup money on software.

#47 Posted by hoosier7 (3780 posts) -

Ouch, not going to be long until those investors really start banging at the door demanding a sell off.

#48 Posted by regnaston (231 posts) -

From the dualshockers link in the OP

"We have to keep in mind that this kind of result is pretty much to be expected at the launch of a new product. Many of the costs normally associated with the release hit a company in the period immediately before and after launch due to marketing, R&D for updates, returns of faulty units (that are normally in higher percentage close to release) and similar initial expenses. Paradoxically, in this period a high volume of sales can actually contribute to push the numbers further in the red."

#49 Posted by shawn30 (4364 posts) -

@shawn30 said:

Easy pill to swallow, no. But minus a time machine Phil has to deal with the Xbox One as it is. He unbundled Kinect to drop the price, but didn't halt Kinect enhancements or apps like Xbox Fitness, Upload Studio, Twitch, ect for those who use Kinect. He's doubling down on games, which when you look at Killer Instinct Season 2, Scalebound, Halo:MMC, Sunset Overdrive, Forza Horizon, Gears of War 4, Crackdown, Quantum Break, and Halo 5 as known games coming in the next 2 years he's on a far better path than they were on. When you hear his interviews it seems like he gets it. Look, the Playstation 4 is selling like a monster as Sony has done a great job all the way around with it. The One will struggle, especially overseas, but Halo 5 and Gears, along with price drops and other titles will likely see a long-term profit for the console. Everyone eats it year one. Years two, three, and for, as production costs drop, install bases increase, and Live subscriptions grow will see the One doing just fine. There will be a Xbox 2, and they will have learned the painful lessons from this gen, even as it will likely gross a profit when its all said and done minus Kinect and RROD. If there's a PS4 considering Sony's company wide dire situation and the failure of the PS3 to the tune of 6 billion, no way MS doesn't do a Xbox 2 with the hard lessons learned IMHO.

I still do not think it needs to be stressed enough that the 360 and PS3 sold 85+ million over seven years, and 8 months into this gen PS4 sits at 9 million, the One at 5. A shit-ton of fans have not upgraded yet. And no matter where you sell your consoles the most, doesn't meant you can't sell great their again. MS will lean on the US and UK all gen long, and gain a nice chunk of sales even as it will likely be millions beHIND the PS4 in sales. At least that's what I think.

Either XBone will be Microsofts Dreamcast or it will be their Master System. Just depends on their level of commitment, I suppose.

This, I can agree with. But with the games on the way I still think it can be a success. Time will tell. The Xbox 2 however, I think will be a monster.

#50 Posted by Shewgenja (8466 posts) -

@shawn30 said:

This, I can agree with. But with the games on the way I still think it can be a success. Time will tell. The Xbox 2 however, I think will be a monster.

I don't doubt that if they stick to gaming, their next console will make the mistakes the Bone did. There will be no motion control hype to get in the way of their vision for the next XBox. I do say that they are in a sticky situation over all. Sony is going to want to keep Gen 8 going for a long time (likely, not as long as Gen7, but still).

The biggest unknown ahead for gaming is whether VR will catch on. If it does, expect Sony to go all in with Gen9 and if not, expect Gen 8 to be a somewhat shorter gen because the next leap in tech will be a whole lot clearer (4K gaming). Until ATI and NVidia can get single-chips running cool and capable of 4K 60fps, we're looking at a pretty long gap. This could deteriorate relationships with 3rd party and XBox.

I'd be weary of the long-term trap that Sony sprung if I were management at XBox. Saying that being real as real can be with no fanboyism. If Oculus Rift and Morpheus become commercially successful, it will be harder for MS to justify to consumers the need for upgrading simply for the reason of better hardware. At the same time, the XBone is tangibly under-powered to do VR meaningfully. It takes a lot of horsepower.