Microsoft announces $62 billion revenues
Entertainment and Devices division increases profit margin by 529% to $679 million for the year
Microsoft has announced total revenues for its fiscal year ending June 30, 2010 as $62.5 billion - a rise of $4 billion over the previous year, while the software giant's net income stood at $18.7 billion, a rise of $4.2 billion on fiscal 2009.
The Entertainment & Devices saw revenue rise significantly over the last three months of that year to hit $1.6 billion, up from $1.3 billion in the same period of 2009, while the full year revenue rose by just $20 million to $8.058 billion overall.
That segment of the corporation, which includes the Xbox business, resulted in a loss of $172 million for the last quarter, but saw profit over the whole 12 months jump from $108 million is fiscal 2009 to $679 million in fiscal 2010 - a rise of 529 per cent.
The company revealed that it shipped 1.5 million Xbox 360 units between April and June this year, compared with 1.2 million the previous year - but full year numbers were down overall, falling from 11.2 million to 10.3 million.
However, the strong rise in net income was mainly attributed to the decreasing cost of the segment's revenue, which fell by $528 million - in part thanks to "lower Xbox 360 costs", while royalties from third-party content on Xbox Live also increased.
The big problem with the original Xbox was due to the financial contracts between nVidia and their HDD suppliers. While MS lowered the market price of the Xbox to remain competitive, their components prices did not fall to match the price reduction.
This is also why MS rushed to get the Xbox 360 to market so quickly as it removed them from the confines of the original contracts.
I also remember their dilemma with the costs for the first Xbox... think I red it in "Xbox 360 uncloaked" by Dean Takahashi... very nice book by the way...
Xbox, and this should increase over the next few years, opens new doors for content, products, platforms, infrastructures, and also overall Microsoft brand positioning. Looking at the big picture, I'm not sure looking purely at the Xbox P&L in 10 years will be the best way to judge of the business success to (maybe) come.
Now, of course, that's still a few miles behind something like the iPod, which managed to achieve all these things whilst generating humongus profits ;-)
2001 -2 billion
2002 -2 billion
2003 -2 billion
2004 -2 billion
2005 -485 Million
2006 -386 Million
2007 -1.89 Bill (RRoD Year)
2008 1.3 bil
2009 1.6 bil
Promising. :)
Here is the list as I am aware of it starting with 2004 () - indicates loss:
2000 - ($1.1B)
2002 - ($1.7B)
2003 - ($940M)
2004 - ($1.0B)
2005 - ($470M)
2006 - ($1.3B)
2007 - ($2.0B)
2008 - $267M
2009 - $108M
2010 - $679M
So they're moving in a positive direction but are still about 7.5 billion in the hole after clawing back just over $1 billion over the past 3 fiscal years.