Monday, May 01, 2006

Microsoft reveals year-end financials

Microsoft Reveals Year-End Financials for the "xbox", and "xbox360".

Microsoft also revealed its latest financial specs, though in its case they pertain to its third fiscal quarter, which ended March 31, 2006. The company saw quarterly profits of $2.98B on $10.9B in revenue, a 13% increase year over year. Revenue did not quite meet estimates, due in part to the continuing costly Xbox 360 launch. Related expenses, including the significant loss taken on the sale of each console, meant Microsoft's newly restructured Home and Entertainment division saw $1.06B in revenue but a loss of $388M for the quarter, up a striking 122% year over year.

In addition to 360-related expenses, tapering sales of Halo 2 were actually a big contributor to the rising loss. Revenue in fiscal year 2005 saw a big boost from Bungie's blockbuster, but sales have of course slowed recent months, contributing less to Microsoft's bottom line. Microsoft expects the trend of increased loss to continue in the near future, but noted that 360 should see positive profit margins within its life cycle.

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