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Old 12-07-2012, 01:03 PM   #69
Nathanael
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Join Date: Jul 2010
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Quote:
Originally Posted by fjtorres View Post
XBOX is the revenue generator in that division--their online efforts (Bing, ad sales, etc) are the sinkhole eating up XBOX revenues. XBOX generates north of a billion in profits by itself.
Bing, et al, are over in the Online Services Division; X-Box is in the Entertainment and Devices Division (which includes Windows Mobile, keyboards et al., and now Skype).

The Online Services Division had a net operating loss of more than $8 billion dollars in FY12 (though that included a one-time goodwill impairment charge of $6.2 billion from the aQuantive takeover, which is a story in itself). Entertainment and Devices had operating income of $364 million on revenues of $9.6 billion, which is as close to break-even as you'll get in Microsoft terms.

I have not been able to find any breakdown by product of MS's operating income. Where do you get that the X-Box makes more than a billion in profit?

Quote:
Nonetheless, $364 million net profit is about as much as Nintendo makes in a good year. More than Amazon itself nets, too.
I'm sure it is. But in terms of Microsoft's bottom line it's insignificant. And that's been my point since I entered this discussion: Microsoft's revenues and profits are driven by two products, Windows and Office. And that's been true for nearly two decades. But that market has stagnated (operating income from Windows and Office has declined in each of the past two fiscal years, and looks set to decline again this year).

Microsoft needs to find replacements for its declining Windows and Office OI, but a few hundred million from its Entertainment Division won't come close to making up the difference. And early numbers coming in on Windows 8 and MS's tablet push in general are less than encouraging, as is implied in the topic of this thread.
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