Analyst Shauger: Microsoft loses money on every Xbox 360 sold

Gamesthirst writes: On September 23rd 2009, Caris & Co. held a conference call on Microsoft in which many interesting information were released. Caris & Co. analyst Curtis Shauger warned, weakening Xbox 360 sales were likely to hurt top-line results for both the fiscal quarter ending September, and for the June 2010 fiscal year. He trimmed all his forecasts for the Redmond giant. 1st quarter revenue to $12.3 billion from $12.8 billion. And for the full year to $59.1 billion from $59.9 billion.

[Alcon Caper]

"Shauger also points out that, hardware sales are dilutive to earnings, he says, Microsoft losses money on every Xbox 360 it sells."

Losses money? Is that a financial term? Loses? Losses? Losssssses?

LOSSSSSSSSSSSSSSSSSSSSSSSSSSS SSSSSSSSSSSSSSSSSSSSSSSSSSSSSSS SSSSSES???

[El Botto]

They sacrifice margin hoping to get higher sales. Either way, the XBOX division is bleeding dead.

And looks like financial crisis has hit MS hard.

[Shadow Flare]

lol i find that pretty hard to believe. I'm sure if microsoft sold the 360 for $1 they would still make a profit

[Maddens Raiders]

it's the equivalent of a short block V-8 (LIVE) crammed inside the walls of a Yugo (360 console). How can you lose money on such a contraption, yet the article states the contrary?

[Persistantthug]

(error on this one.)

[StanLee]

It's all speculative, not factual. His expectations are based solely on assumptions. With the elimination of the Pro console, Microsoft all but assured that it profited on each console, even after a price reduction. Still, a revenue adjustment to $59.1 billion from $59.9 billion isn't very significant.

[Persistantthug]

What many of you may not be figuring, is the fact that defective XBOX's has caused alot of shortfall. That billion dollars they have put aside has been run through by now, long ago in fact. And worse yet, there seems to be no end in sight. Everytime a 360 is broken it adds to the average cost of each unit. Then factor in that many units have malfunctioned more than once....more than twice...that's alot of money.

[SuperM]

well. Microsoft probably arent as good at reducing costs as Sony. So i guess Sony has almost if not already caught up with Microsoft in terms of cost of the machine. If that is the case then sony has a major advantage since their machine has bluray wifi etc.

[Raf1k1]

I doubt it considering all the cheap components used.

[Persistantthug]

Because Sony makes and buys so many other hardware related products for all of their other goods and services, Sony carries the extra advantage of leveraging their buying power...not to mention they manufacture lots of their own stuff.

So for example, they could buy or sell an X amount of TV tubes from Philips, in exchange for a better price on said amout of BluRay Lasers for their Australian market, to which they might even sell to a different companies at a higher price.

Sony specializes in that type of leveraging and has so for decades.

[jjohan35]

Doesn't matter if they lose money per 360 sold. They're still raping their customers with the annual Live service.

[sunil]

Gotta spend money to make money

[mastiffchild]

The warranty must cause a bit of a financial hit but after so many new boards surely they sell each console at a profit, no?

I guss to MS the thing with the warranty is that it works out much cheaper than court cases and/or a recall of units so wouldn't it have been figured in a LOOOONG way back?

Sunno whether there's any truth in this at all-when have the analysts got anything correct this generation anyway?

[gaffyh]

I said it a while ago when MS released their financial results for the latest quarter, and when they announced the price increase for the Arcade unit, but fanboys didn't believe me then.

[glennc]

@jjohan35 - bit of a drama queen are we?

[TOSgamer]

I'd be shocked if MS was losing money on each unit 4 years after launch. If they are then that's just poor planning.

[evrfighter]

"I said it a while ago when MS released their financial results for the latest quarter, and when they announced the price increase for the Arcade unit, but fanboys didn't believe me then."

This isn't factual so you were never right to begin with. Take a look at the hardware in the 360. If they are even spending more than $150-$175 to make one. Someones ripping them off.

That said never cite a speculation article to claim you were right. Makes people with common sense LoL at you.

[KingME]

Just more blogging bull, that's be eaten up by the local PS3 fanboy. Right Gaffyh?

@maddens - It use to be uncharacteristic of you, but you are starting to become a bit of a troll aren't you?

[Sarcasm]

They make more profit from XBL and overpriced accessories.

[Anon1974]

For the six months after the price cut, Microsoft had record 360 sales, revenue for the Entertainment division was up, but profit fell almost half a billion dollars versus the same quarters the year before.

I looked at that and said "Hey. Sales are up, revenue is up, but profit is way down despite record sales. How can they sell more, bring in more money, yet make less? That looks like the 360 hardware is being sold at a loss."

I was inundated with hate mail from 360 fans who claimed I was just a PS3 fanboy bashing the system, but no one dared venture a guess as to where all the profit had gone despite the increased sales and increased revenue.

And here we have an analyst saying the same thing - and again people don't believe it. To them I ask, you tell me how in the six months after the price cut, revenue can be up, sales can be up but profit can fall 130% versus the year before.

[oohWii]

See here's where you loose me. Had the same analyst said the same thing about the PS3, you would be in an uproar, you would be b!tchin' and whining about "What do these analyst know anyway.

This is the problem with you PS3 fanboys, you run a double standard, nothing negative applies to the PS3 only the 360 and wii can have negative news on this site. The evidence is all over this site. Notice that only the PS3 worshippers have bubbles, everyone else has been attacked by you, morganfell and Madden's lemmings.

Let's try and break it down shall we?

There was a conference call about Microsoft's finances, yet there were enough low level clowns in the room to the point that the story was leaked within 24 hrs. Now, if I had a meeting with an analyst about my company you best believe it would be confidential, and if he leaked it, my financial problems would be over because I'd sue his a$$.

Second, "As Shauger notes, the cuts are based on lowered sales expectations for the Xbox 360, which he explained are being stalled by stronger demand for the PS3 since its recent redesign and re-launch, and Microsoft's own price cuts on the Different Xbox 360 models." (NOTE THE WORD "EXPECTATIONS" company react on actuals)

Okay, the PS3 slim has been out for about 3 weeks, 3 weeks people and we know how the PS3 was selling before that. Now, this guy has determined that MS is loosing money on every 360 sold without even having a months worth of data to go on (And he's doing it during the same month of the price drops). On top of that, the 360 sells have increased by over 100,000+ per month since June (vgcharts, best I had) therefore instead of sells slowing as this so-called analyst say, they have actually increased. Once again, he going on 3 weeks worth of data.

third, why is he discussing Microsoft's numbers with Microsoft, they already know their numbers, and I can assure you they also have their own analyst that do the math for them (people that won't leak the info within 24 hours.)

So, please people explain to my why it's so easy to convince you sony fanboys when there is negative information about the 360. As I said earlier, if this was PS3 news you would be screaming foul.

Whatever, you folks are incredible.

[commodore64]

@ darkride66

(quote)
"I was inundated with hate mail from 360 fans who claimed I was just a PS3 fanboy bashing the system, but no one dared venture a guess as to where all the profit had gone despite the increased sales and increased revenue."

Dear oh dear, darkride.
Where shall i begin ripping apart your post?

- First of all, I have, in the past, responded to you several times with plenty of reasons for the reduced profit in the EADD.

- I previousy correctly pointed out to you that the EADD was comprised of several different market segments, some completely unrelated to each other, thus the general financial report cannot be used to isolate the 360 variable.

- I previously correctly pointed out that increased 6 monthly revenue might have had a lot to do with increased revenue in other areas, but nothing to do with the 360 per se.

- in fact, a quick check of MS investor info shows that the COST OF 360 HARDWARE HAS REDUCED.
"Cost of revenue decreased $326 million or 7%, primarily due to decreased Xbox 360 platform costs."
http://www.microsoft.com/ms...

- Additionally, a quick check of MS investor info shows that the reduced profit was subsantially caused by R&D in other areas:
"Research and development expenses increased $252 million or 16%, primarily reflecting increased headcount-related expenses associated with the Windows Mobile device platform, driven by recent acquisitions. http://www.microsoft.com/ms...

- I previously correctly pointed out that over the course of the whole year, revenue was actually DOWN... leading to overall lower profits - a point which you were forced to acknowledge afterwards without giving me credit. http://www.microsoft.com/ms...

- You failed to take into account invested development costs for NATAL (which is yet to earn any revenue), ZUNE, MSN live, Automotive sync software, Internet protocol television software, the Microsoft Surface computing platform, mobile and embedded device platforms, MS's line of application software/hardware for Apple's Macintosh computers and Microsoft PC hardware products, and marketing for Microsoft Office and Windows operating systems.

- Your argument is/was so full of holes and erroneous assumptions, that it is/was an absolute cinch to debunk your FUD and speculation with the facts.

... and yet here you are claiming no-one responded to you?
... and yet here you are making the same FUD speculation again?

You are absolutely unbelievable!
How many more times do I have to correct you before you stop lying to everyone?
How many more times will you claim no-one offers you plausible explanations, when clearly i have done exactly that countless times?

Get a grip, old boy.
Please.

[jjohan35]

Not really. If I'm paying for their Live service, I expect better online play on major games like Gears of War 2. That game was so buggy online.

[Anon1974]

You have not once responded with a CREDIBLE reason why Microsoft's Entertainment's profits are down so much since the price cut, other then mumbling something about "It's not just the 360,"
Yes there are other divisions withing Microsoft Entertainment, but all of them combined don't equal the 360's revenue stream. Why do you keep pretending that that somehow doesn't matter? I know why, because then you'd have to come up with another explanation, and you don't have one. Microsoft themselves said the drop was due to "increased costs of revenue," ie...we cut the price of the 360 and it's caused a sharp drop in profits despite revenue going up for the six months after the price cut.

And stop throwing up unrelated links. We're talking the six months after the price cut, not the whole fiscal year. I've corrected you on this time and time again and you still keep doing it. FACT: MS Entertainment Revenue went UP the six months after the price cut and profit dropped almost half a billion versus the same six month period the year before. You're proven you can view the Microsoft Investor center, now how about looking at the data we're talking about here, not pulling reports at random.

This isn't rocket science. For the six months after the price cut, sales shot up, revenue shot up, profits shot down for the Entertainment division. Coinciding EXACTLY with the 360's price cut. Are you truly that blind that you still think it was unrelated?

I think the fact that we have analysts now, agreeing with me, that would carry some weight, but you still just plug your ears and deny, deny, deny.

You keep arguing, you keep being wrong and yet still won't let go.
You're simply wrong. Man up. I challenge you to directly refute what I'm saying.

In the six months after the 360 price cut - was MS's entertainment's revenue up compared to the same six months the year before. Yes or no?

In the six months after the 360 price cut, did MS entertainment's profits drop over 400 million compared to the year before. Yes or no?

Quite dancing around the issue.

[PROFIT]

buying timed exclusives
rrod
lawsuits
buying dlc
paying for viral marketing
hddvd

its all one big failure

[KingME]

Try paying for something better than a 200 up 300 down internet connection.

@Darkride - Dude you are so FOS (Full of SH!T), you talk a good game, but if you haven't noticed simple human behavior, the true ballers let their game talk for itself, people that are constantly trying to convince others of their prowess are typical just pretenders and not contenders. You clearly fit this profile. I wish you would just shut up and stop trying to act as if you are some sort of financial analyst. DUDE YOU'RE A FRICKIN FULL TIME GAMER; and the rest of your time obviously is spent on N4G pretending to be a financial analyst.

I have yet to hear your analysis on why the PS3 was loosing money. As oohwii said earlier (above) The slim has only been out 3 weeks and the analyst depicted in this fable is already drawing conclusion the 360s sells are deminishing due to higher demand for the slim, while at the same time the numbers have shown an increase in sells for the 360 also.

Please man, just be quiet already.

[360FTW2]

Since the sell of the first PS3, Sony has been spending time.

Release a developers nightmare and sell it for 599
Pay off Movie companies to support BD vs HDDVD
Releasing PS3 updates on a weekly basis
Removing features from the PS3 to bring down manufacturing cost.
Dropping the Price of the PS3 to 499
bundling top rated 1st party title to PS3 to spark sells.
Removing more features from the PS3 to bring down manufacturing cost.
Dropping the Price of the PS3 to 399
Bundling More top rated 1st party titles to the PS3 to spark sells.
Completely abandoning the original PS3 design and taking a mulligan.
Creating the PS3 Do-Over (PS3 slim)
Sell Do Over for 299
Add 250 HD to Do Over and try an sneak the price back to 399.
Copying features from XBL that PSN wasn't designed with.
Sounds like failure over and over to me.

See how easy it is to put a negative spin on simple bullsh!t?

[Anon1974]

You didn't address a single thing I said. Why don't you do some research and verify whether or not I'm telling the truth rather then making yourself look foolish, like Commodore does time and time again.

As for the PS3, you haven't been paying attention. I've commented plenty on the PS3's current situation. Sony, like every other Japanese electronics maker, is being hit by slower consumer spending and a rising yen that's now over 25% higher versus the US dollar then it was a year or so ago. Same goes for the Euro. They're getting creamed on currency exchange rates because they sell so much product in the west. Financial analysts and Sony themselves have said this again and again. This isn't a secret.

One year ago, Sony's game division was turning a profit overall before the current economic crisis really hit home - and Kaz himself has stated the PS3 has actually been profitable as a platform for the last fiscal year, however, Sony Entertainment isn't just the PS3.

How about you do some research on your own, or at least check my posting history before you criticize. This article just verifies what I noticed months ago. These analysts are responsible for advising on business matters. They have no reason to give false info regarding the 360.

[Vavoom]

"This article just verifies what I noticed months ago. These analysts are responsible for advising on business matters. They have no reason to give false info regarding the 360."

Okay, first off this article is a blog which is laced with speculation and conjecture. Not once have the blogger issued a reference to the materials that proves that the information was indeed spoken. There are no links to documents supporting this phone call, I'm sure your trusted analyst would have at least sent his findings in hard copy.

"Kaz himself has stated the PS3 has actually been profitable as a platform for the last fiscal year, however, Sony Entertainment isn't just the PS3"

Uh, and what do you want him to say, the PS3 is bleeding money out the A$$. If the PS3 was making so much many at 399, 499, 599, then why is now only 299? Perhaps since you're a special in Sony business you should spend more of your time explaining Sony's troubles instead of trying to analyze Microsoft.

I guess the problem I have with your line of comments is, you make excuses for Sony. And then you make BS claim about MS and try to pass them off a fact, when the only thing you can do is give you untrained, uneducated (On what's really going on) opinion.

This is probably why Kingme is criticizing you, it's sure as hell's the reason I would be.

So this article proved nothing, nor does your past posts. Kingme is right, stop trying to be an analyst. I understand that Japan been taking a beating by the economy; WHO HASN'T?

[jjohan35]

Is that because Xbox Live depends entirely on P2P LOL!

You assume too much. I switch between T1 and DSL depending on where I live (military life). In both cases, Gears 2 was buggy online. And I don't know why people don't address the fact that COD:WAW always kick 360 users out of the lobby after every other game. My 40+ friends on Xbox Live share the same problem.

Getting that type of service while paying $50 per year is rape by Microsoft.

[Anon1974]

I just said why the PS3 was having troubles, right above your post. You obviously didn't read it, otherwise you wouldn't have made that comment.

In regard to Kaz's statement, if the PS3 was bleeding money they just wouldn't say anything. You can bet if he said the PS3 was making money, it's making money. He has a responsibility to the shareholders and if he makes incorrect statements regarding a material fact such as this there's consequences. If he says the PS3 is making money, that's something that can be backed up or else he wouldn't have made that statement.

As for the analysts statements - financial analysts generally get paid for their advice - they don't just throw it out for free on the internet for anyone. Having worked in the brokerage industry for a decade - those analyst reports don't go public. They might make a statement, but 90% of the time it's only industry professionals or people who pay for them that have access to those. You say the author didn't provide links? You obviously didn't look. There's links all over that article, leading to the site where you can pay to receive a copy of the reports in question.

If you're going to criticize my views, at least have the balls to do the research and see if I'm right or not. Every single thing I said is true and easily verified if you just took a second to actually look it up. You're clearly ignorant of the facts of the matter so why don't you take a bit, get informed and then come back if you want to criticize my statements. Debating you on this issue when you haven't bothered to get informed is about as frustrating as arguing with a chimp.

[Alcon Caper]

"Just as that started to happen, the company is now launching a new hardware iteration. New hardware means new costs. When The Times asked Sony exec Kaz Hirai if Sony was losing money on the PS3 Slim, the exec said this:

If you're just talking about the hardware alone, the quick answer is yes. That makes good headlines, but I don't actually know that that's the true nature of the business that we're all in, whether it's PlayStation, Xbox or the Wii. I think the better indicator is to look at the business as a whole platform, to ask: are you profitable in terms of the hardware, software and peripherals. And the answer to that question is yes on a gross profit level since the last fiscal year."

http://kotaku.com/5344701/s...

So when we're talking about hardware, yes, all consoles lose money. But to take into account software, peripherals, etc, that's where the business plan balances out.

Don't take it from me, take it from Kaz...

[klashawnd]

Exactly.

[SupaPlaya]

I think Wii may be the exception here. They may be making $$ on each console sold.

[mastiffchild]

I think so too. Didn't Ninty rubbish a site that said they only made $1.49 on each Wii? I think the latest estimates I saw were around $25 per Wii in the US-which adds up to massive money if it's true.

With the redesign and cut in price Sony are anywhere from back to a $40 loss and near even so you just have to guess-we don't know what the compoments cost in those volumes do we? Anything could be true I suppose.

Same for MS. How many new boards have they had out now? 4 or 5? How do you estimate what each one costs for MS to make let alone transport and store worldwide. Plus they probably cst different amounts at different factories-it's a complex issue, imo, and hard to say who's near the magic numbers.

[raztad]

@Supa

Bro, the Wii is a highly overpriced last gen console. I' m sure Sony makes profit for every PS2 sold and the PS2 is just $99.

[Sarcasm]

I doubt Nintendo makes only $1.49 or even $25 profit off the Wii. I think it's more than that.

I mean come on, it's not like the hardware is remotely cutting edge. They're rolling in dough and making millions off it.

[cooldude123]

wasn't Gamesthirst the same blog that had the internet buzzing with news on "Microsoft fears PS3 overtake? The same blog that brought news about Final Fantasy selling 1 million in the first week of availability that all embraced?... Geez, boy I tell you...

[Pootangpie]

seriously all companys lose money on every console sold it's software where there making most of the profit I'm pretty sure sony lost plenty more on the PS3 and slim for that matter it's actually offical there is absoulty nothing news worthy on this site it's just a bunch of journalists stupid opinions and BS horse**** that people have already know when being a gamer since middle school

[Chubear]

Did the PS1 lose money? no. Did the PS2? No. Did Sega's first console? No. Did Nintendo's? No.

Some Console may lose money on hardware initially but in the long run, if your business model is good, you eventually make money off the hardware too.

[v1c1ous]

blogspot articles in the past week...

[Meus Renaissance]

Does anyone honestly think the technology in the 360 costs around 300 to manufacture?

[ghostface]

Are you going to cry?

[solidworm]

the rrod is what is killing MS not the money lost on the hardware.Sonys comeback is only twisting the knife deeper.

[Death]

Losses aren't carried over year to year. Each fiscal year starts out new. If you look back at Sony's financial history over the last decade or so you will be very surprised to see they lose money more often then make it in their games division. Nintendo is the only one that has shown a profit every year for the last decade and that is mostly due to the DS.

Here is 3.3 billion in losses for Sony's gaming division for fiscal 2007 and 2008 alone. http://www.gamesradar.com/p...

-Death

[Anon1974]

Death said "losses aren't carried over year over year."

Those losses don't exist in a vacuum. They end up being carried forward on financial statements as liabilities but that doesn't mean they just cease to exist, they eat away at company capital, they diminish a company's net worth. They need to either be paid off, floated on credit, turned into some kind of debt instrument, etc..etc.

Both Sony and Microsoft have taken hefty losses this gen, but Death's right on about Nintendo. The DS has been a monster for them. People think the Wii is profitable, it's nothing compared to what the DS brings in to Nintendo.

[Father Murder X]

How in the hell are they losing money on damn near 5 year old technology after selling 30 million units!!

[KingKionic]

I really doubt Microsoft is losing money on xbox 360 .

The even overpriced the hardrives and adapters .

[DelbertGrady]

I thought that marketing lie was exclusive to Sony?

[Raoh]

its all about points of view..

there is a difference between revenue and profit etc

2 examples..

sony lowered sales expectations to meet expectations.. that kept them in the black..

microsoft last quarter made a profit thanks to xbox hardware sales, but lost that profit due to over marketing and exclusive deals

business is a tricky business and its all about wording and moving money around..

technically is the xbox brand profitable yet? MS lost 3 billion on the original xbox, where did that money come from? then spent another 3 billion on the 360.. where did that money come from? halo and 360 sales are up and created a profit.. but where did the money go? RROD 3 year warranty and DLC purchases..

sony is losing money on each console sold but makes money avatar and HOME software.

madden may have sold more on 360 over the ps3 but more madden was sold over sony's playstation ps2/psp/ps3 brand overall than any other

[AnonUser5555]

Lowering expectations to meet expectations does not influence being in the red or black.

[AnonUser5555]

Just like everyone who talks about Sony losing money on each PS3 system sold: You're Not Looking At The Big Picture.

This applies to Sony and Microsoft.

It DOES NOT MATTER if the system itself loses money if OVERALL, the company makes money on the purchase.

A person doesn't just purchase the system and STOP. They purchase controllers, network adapters, wireless keypads, remotes, headsets, set. Peripherals have a crazy amount of markup. For an example, Microsoft continuing to charge $100 for a wireless adapter. And do you think that the DualShock3 really costs anywhere close to $50 to produce? I think not.

And of course, this doesn't take into account games, DLC, etc., all of which Sony/Microsoft get a cut.

So please, don't just say "Sony/Microsoft lose money on each PS3/360 sold," because it's really not accurate.

[HDgamer]

This analyst has about as much credibility as Patcher

[KingKionic]

lol...but he was right about the wii price cut...finally.

XD

[cyborg6971]

In reality it's the purchasers who lose money after the third one they are forced to buy.

[BYE]

So it's a lose-lose situation.

[DailyAddict]

I highly doubt this report. The 360 is the cheapest built console of all 3 next generation systems in terms of materials and production. It has a 1982 disk tray with spray painted chrome on the elite (everyone else is slot loader), loud and clunky fans, no wifi and the wireless controllers don't even come with rechargeable batteries. Losing money on each console my ass.

[niceboy]

you have to lose money to make money

[niceboy]

will they be able bring the price of the 360 any lower? Maybe not until the next year..

[niceboy]

games, games, games...

[devilhunterx]

sorry loyal consumer! all you get is $60 DLC

[glennc]

and you guys pay for demos - GT prologue anyone.

[niceboy]

it seems only Nintendo is making a profit...

[niceboy]

reminds me of patcher..

[PLAYstar]

C'mon losing what money? Xbox360's parts could be found at any pawn shop. RRODs Xbox360 can be dig out from garbage bin all around the world. The disposal was then recycled into a $299 box. The process then repeat all over again. Now you know why xbox is entitled with a "360".

[Omega Zues]

MS counts sales as "shipped to store" not "sold to customer". So who knows just how many units have actually been sold to consumers.

[NoOoB101]

So you justify your purchasing of a console through Multiplats?? Just because ODST sold that many dos'nt make it a great game. Killzone out performs ODST by far. And the power of the cell has shown it can create games far beyond of the old hardware you call an Xbox. Not to mention Wii Sports has out sold the entire halo franchise..

[firezone]

I thought we were talking about Making profits here, where does this ranting come from?

[NoOoB101]

It comes from Buying1999 trolling =/

[Elvfam511]

I'm a Ps3 fanboy I highly doubt MS is losing Money on Each console sold

[Double Toasted]

...

[Feral Gamer]

Last year there were articles saying that MS made a profit on the 360? What happened to those? Didn't this analyst read them? I call BS

[bjornbear]

so do those who buy a 360...*zing*

EDIT: ok ok jk/ jk/, this is highly unlikley...

[chisox100]

xbox has master cheif, ps3 has nathan hale, snake, sack boy, ratchet, kratos and drake

[RAM MAGNUMS]

each xbox 360 comes with a 3 year warranty that you will use.
the price of that warranty along with the monkey power to repair it and the shipping and handling adds up.

[djfullshred]

Both Microsoft & Sony use their consoles as a vehicle to make money on software and other related online services. The big picture for both of these companies is not necessarily making profits off of the boxes themselves. They can even afford to lose money on hardware sales if they make it up on the related content sales.

[glennc]

only nintendo make profits on hardware. the others rely on software, how is this news???? this is common knowledge.

[firezone]

Not even Nintendo makes much of a profit, although the way is basically a Gamecube with motion controls

[firezone]

is there not a way, these guys could make the consoles cheaper? I mean, every cycle is the same scenario.... It's nonesense

[JJFNIGHTS80]

Ok how come now I start to hear M$ starts to lose some money on the Xbox 360 and every other month or quarter or so every analyst keeps talking bout SONY Is loosing money on each PS3 sold.

[patterson]

Whether M$ makes or loses money on 360 hardware, they make it up with the annual Live fees.

Over the course of owning a 360 you will have paid for 3,4,5,6 or 7 360's.

[kewlkat007]

Whats up with all the Blog/Assumption articles...

Were talking about hard numbers here...

Fail!!!

[hard joe]

m$ can cover the loss from selling halo
short campaign + old engine = low cost
DLC sold at full price = high sales
high sales - low cost = great margin

[niceboy]

Wow, had no clue. lol...

[niceboy]

However, I hope they get through this, as seeing the quit won't benefit gamers at all.

[outlawlife]

yahoo posted the figures a few months back MS was at the time making 75 dollars per 360 sold

they had each console broken down into manufacture costs vs retail sale price

this article is just flat out wrong, it has been shown by several other reputable sources

[Bathyj]

Why is this so hard to believe?

How many unplanned price cuts do you think they can do before they start cutting into profits? Whose to say that were even making that much before the cut?