Microsofts X-box division down $4 billion

[The Mullinator]

http://news.com.com/2061-10797_3-5884322.html?part=rss&tag=5884322&subj=news

I don't care how good the 360 is, Microsoft is going to have a hell of a time trying to just break even if they are down that much.

Anyway, its numbers like those that make me wonder if the 360 doesn't turn out so hot for Microsoft in the money department then I wouldn't be surprised if it becomes the last console Microsoft decides to make.

 

[63]

That be alot of booty.

 

[KU_]

....Ouch. How is MS going to dig theirselves outta this one? I don't think we'll be seeing an Xbox 720.

 

[Vegeta897]

I wouldn't be surprised if it becomes the last console Microsoft decides to make.

Didn't they say it would be? And that they will start working on making Windows better for gaming. I recall reading that.

 

[IchI]

Microsoft always said they had no good expectations for the xbox, it was simply a way of learning the market and seeing what they could offer. Xbox360 is the result of there research and development. If they saw no clear answers to why xbox did so bad they would not be stupid enough to make an Xbox360. In my opinion Microsoft will no way come off as the losers. I also wouldn't be suprised if the 4billion also contains all the games development companys they bought. These will obviasly not actually make any profit (over the amount they payed for the company) for some time. Not to mentioned that Microsoft has bought a lot of the good games companys to go exclusivly to Xbox360.

 

[Ames]

Should have given the money to me instead joke.

 

[The Mullinator]

Microsoft always said they had no good expectations for the xbox, it was simply a way of learning the market and seeing what they could offer. Xbox360 is the result of there research and development. If they saw no clear answers to why xbox did so bad they would not be stupid enough to make an Xbox360. In my opinion Microsoft will no way come off as the losers. I also wouldn't be suprised if the 4billion also contains all the games development companys they bought. These will obviasly not actually make any profit (over the amount they payed for the company) for some time. Not to mentioned that Microsoft has bought a lot of the good games companys to go exclusivly to Xbox360.

If losing 4 billion was just testing the waters then it sounds like they slipped, fell in and almost drowned.

I agree that they can recover but by the sounds of it the 360 is not going to be likely to allow them to recover for quite a long time even if it is a huge success.

EDIT: W00T!!! My 5,000'th post!

 

[Cole]

Microsoft needed to set themselves up. Spending $4 billion was something that they needed to do to gain big. The Xbox gained big all right because Microsoft put a ton of money it. They may need to do this again in japan and europe to even expand it more. But here, in America they will probably start to cook up a very big profit.

 

[Iced_Eagle]

If losing 4 billion was just testing the waters then it sounds like they slipped, fell in and almost drowned.

Considering how huge the market is, and M$'s seemingly unlimited bank vault, I'm sure it was a hit, but they will gladly take it for the long term success...

 

[KU_]

Considering how huge the market is, and M$'s seemingly unlimited bank vault, I'm sure it was a hit, but they will gladly take it for the long term success...

Isn't the industry worth around 11 billion? If so, losing 4 billion in a 11 billion dollar industry isn't good at all.

 

[Iced_Eagle]

We aren't talking about the games industry as a whole though. We are talking about Microsoft. We also aren't talking about how many games and consoles are sold, we are talking about financial income and losses on the developer level, not consumer (industry sells around 11 billion dollars... That number doesn't include development costs or anything)

They have a Sh!t load of money to spend... I'm not saying 4 billion is pocket change by any means, but I'm just saying that it's not the end of the world for M$.

 

[EVIL]

newsflash: "Microsoft bankrupt, end of world is near"

 

[Zeus]

oh noehs...now we're all going to have to use free operating systems like linux this is horrible!!

 

[clarky003]

I thought with microsoft's hundreds of billions of dollar's they would have enough spare to fling into the industry if it really needed it., a 4 billion upset in their console division.. it's not like they are going to give up because of that... If anything its carried as an invested risk in attempt to launch better gaming products into the market.

Bill Gates owns 9.42% and, with other assets, has a net worth of $51 billion

so yeh basically you get the idea. company net worth is roughly $500 billion.

Holdings of Microsoft Stock

Microsoft has about 5.4 billion shares of common stock outstanding, worth $327.2 billion dollars at current market prices

http://www.freedomworks.org/informed/issues_template.php?issue_id=930

They day microsoft goes bankrupt is the day Etheopians are accused of being overweight.

 

[destrukt]

i recently read microsft makes upwards of 44+ billion a financial year, from windows and office (their 2 biggest products), i don't think it included their other products/services.

 

[MiccyNarc]

http://news.com.com/2061-10797_3-5884322.html?part=rss&tag=5884322&subj=news

I don't care how good the 360 is, Microsoft is going to have a hell of a time trying to just break even if they are down that much.

Anyway, its numbers like those that make me wonder if the 360 doesn't turn out so hot for Microsoft in the money department then I wouldn't be surprised if it becomes the last console Microsoft decides to make.

Congrats on 5000 posts.

 

[Anthraxxx]

Isn't the industry worth around 11 billion? If so, losing 4 billion in a 11 billion dollar industry isn't good at all.

I don't think the 11 billion figure includes the manufacturing costs just to build the console, nor does it include the cost of research and development. I think that figure just refers to games and consoles sold.

 

[Dalamari]

Who cares, I'm getting a PS3

 

[hungryduck]

yea, 4 billion to M$ is nothing.....lost change in a vending machine.

 

[VictimOfScience]

Spending $4 billion was something that they needed to do to gain big. The Xbox gained big all right because Microsoft put a ton of money it. But here, in America they will probably start to cook up a very big profit.

Actually, they're still losing money on every xbox sold and will only be deeper in the hole even after a couple of years of selling the 360. Its a sinkhole for them, but the entire reason behind it is to get a Windows machine in every household in the world. Its insidious and its coming sooner than you think. Clever, clever devils!

 

[TheGrimSweeper]

pfttt
you should all know by now microsoft has an bank account with an infinite ammount of money.

 

[gh0st]

the xbox division is the smallest division of microsoft. its really very meaningless. microsoft put huge scratch into the market and they know they are going to reap some serious marketshare in this industry. MS use 4 billion dollars to wipe their ass with.

 

[Smack500]

Microsoft needs to work on their game selection, seems most experts in these areas are saying xbox 360 launch titles are very weak.

 

[destrukt]

^ that's why they have the support of alot of popular developers, especially japanese ones.

 

[craig]

From reading a lot of your posts I don't think a lot of you are understanding this very well. Microsoft has lost 4 billion on the XBOX since it launched, not since the start of this year, which equates to approxomatley $1bn a year.. with the amount of revenue they generate in other areas this is cump change. M$ has already said too that if they were to loose the same amount of money on the XBOX360 that it would be okay. Basically I think M$'s business model is throw as much money at it as possible till all other companies aren't really able to contend any more then sit back as the profits soar... but the XBOX is a decent console though, so meh..

 

[Cole]

Basically I think M$'s business model is throw as much money at it as possible till all other companies aren't really able to contend any more then sit back as the profits soar... but the XBOX is a decent console though, so meh..

Well not to kill the other consoles, Sony lost quite a bit of money to. Just Nintendo didn't.
Anyway, Microsoft did probably loose the most, and with the Xbox360 if they could really expand in europe and japan and put alot more money in those areas then with the Xbox3 they will probably start to look ahead to make quite a bit of profit.