Unfortunately for Microsoft, their latest games console, the Xbox One, has lost them $400 million since launching in November.
The annual earnings report for 2014 show that an increase in production and advertising for the Xbox One are what is resulting in losses. The company have sold an impressive 11.7 million total consoles throughout the year so far, which is a definite improvement over their 9.8 million last year. Because of this, despite the losses, the company’s revenue has increased to $1.7 billion.
However, the company spent a whopping $2.1 billion on production and the launching of the Xbox One. The report reads:
“Xbox Platform revenue increased $1.7 billion or 34%, due mainly to sales of Xbox One, which was released in November 2013, offset in part by a decrease in sales of Xbox 360.
“Xbox Platform cost of revenue increased $2.1 billion or 72%, due mainly to higher volumes of consoles sold and higher costs associated with Xbox One.”
While it’s certainly not great news, with a string of enticing exclusives lined up, as well as the dropping of Kinect, it seems Microsoft are doing a lot to turn the tide of the current situation.
Originally published August 10, 2014. Updated April 15, 2018.
