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[katsubento]

Thought everyone knew this.

 

[Blablurn]

Thats quite unfortunate. MS needs a win with the XBOX at one point I think.

 

[cartographer]

Mojang cost Microsoft $2.5 billion dollars and generates about $150 million profit per year. Need to wait a decade until it starts making them loads of money.

It makes them loads of money, which is true whether they have made back the initial investment or not. This is a long-term investment and something they see as a cornerstone of the business for the next few decades. That's a really good return on investment for such a large acquisition.

 

[Nessus]

I feel like this is probably why they shuttered Lionhead and canceled Scalebound and don't seem to be willing to pay for more exclusives this generation. They're trying to cut costs and streamline.

I mean, the original Xbox, wasn't it essentially MS subsidizing everyone's purchase of a fairly beefy (for the time) PC? They sold ~24 million units but never turned a profit.

So going into the Wii/PS3/360 generation they were already something like $4 billion in the hole, according to Forbes.

Then the RROD happened. I'd be surprised if that only ended up costing them $1 billion given how near-universal the fault was. I don't know a single person who had an original Xbox 360 who didn't have it die on them. Even my first Xbox 360 S (which I had held off on buying specifically because I didn't want to have one die on me) died after less than a year and I had to send it in get it exchanged.

So the less powerful Xbox One with cheaper hardware designed to be easier to break even on is really the first generation they've had where they didn't run into some huge disaster that cost them billions of dollars.

But I mean even there they had to backpedal right off the bat by cutting the system's price way earlier than they'd planned and by abandoning their attempt to push the Kinect hardware.

I've really liked my Xboxes and the games and experiences I had on them, but they can't continue on like this indefinitely.

 

[00ich]

Buying Mojang isn't because of Xbox, otherwise they would have discontinued all the other versions of Minecraft on other platforms.

Bone X seems like it's very much the last attempt from a heavily under pressure Xbox division to prove it's financial worth. It's unlikely to have cost much to develop since it's based on the same technology as the Bone and it has literally zero exclusive game support whatsoever so it's obvious it's being done on a shoestring budget.

If anything, Bone X is the last chance, if it fails to move the needle on hardware (which it probably won't) then MS will start winding Xbox down and probably exit the console hardware business at the end of this generation. There won't be an Xbox Two, instead they'll switch to pushing set-top form factor Windows PC's or something for gaming and remain a minority player in the software market with their few existing franchises.

XBox x is a strategic device to align Xbox console games and Windows store better.
Xbox only helps Windows store if PC and Xbox version of a game mean largely similar code and can be deployed for PC easily. With Xbox one s and it's on-die framebuffer that seems not to be the case. Xbox to PC ports were almost universally wonky, besides Forza which is their internal benchmark engine.

 

[00ich]

I mean, that's normal for so many tech firms. Doesn't mean the business doesn't have value. Look at Amazon as an example:

They're not very profitable either but they're one of the most important businesses today.

It's normal to invest an reap the benefits much later. With Xbox Mattrick might have undone all these investments and the willingness to start over might be limited.

 

[Ozzy Onya A2Z]

Mojang cost Microsoft $2.5 billion dollars and generates about $150 million profit per year. Need to wait a decade (and hope Minecraft stays relevant) until it starts making them loads of money.

Now factor in merchandising and licensing beyond just software sales...easily double that figure to 300M per year IMO. It wouldn't surprise me if that was heading towards a factor of 3 or 4 times these days. When Minecraft was bought by MS about 50M units were sold, they passed 100M already. There are more streams of revenue beyond software purchases alone.

 

[border]

I've really liked my Xboxes and the games and experiences I had on them, but they can't continue on like this indefinitely.

They almost certainly can continue on like this indefinitely. They shouldn't, but they can. Their profit or loss is mostly a blip on the company's bottom line. And it's currently one of the few industries where everything gets reset every 5-6 years. They've lost phones forever, they've lost tablets forever. No great new product is really going to turn that around. But as PS4 and XB1 are sunsetted, they will have another opportunity to recapture the market.

I think that's why they will probably soldier on for the forseeable future, while trying to leverage their strength in the PC space through cross-play and cross-buy.

 

[daman824]

I didn't say it was or was not.

I originally meant to quote both you and another poster

However, Microsoft is obviously interested in the gaming industry and owning/continuing to support one of the biggest games in the industry for quite a while.

I don't see why they would continue to invest in gaming by buying Mojang and Minecraft while also winding down Xbox as a brand. They are trying to further invest in the industry, not pull out of it

 

[DaleinCalgary]

MS is run by poor management and they have made lots of blunders through the years. But they are not going away.

Im expecting the xbox one x a mistake also as they should have put a better cpu in it and released next year with a lower cost.

 

[Unknown Soldier]

I doubt anybody at Microsoft is expecting a $500 console to be more than a highly profitable niche that represents less than 1/4 of total unit sales.

Why would they bury one of their most popular and most recognizable consumer-facing brand during a generational switch? That's precisely the time it can be reinvigorated. Set-top PCs are a dead-end, as Steam Machines have already shown. At least with an Xbox model, they take a healthy rake of software sales.

The issue is that if it is not self-sustaining, in terms of taking in more revenue than expenses, then it's a net loss to MS for continuing to invest in Xbox. And unless the intangibles of having an Xbox brand outweigh the continuing financial losses, there is no way the correct business decision is to continue. It's not at all clear there is any tangible value to the Xbox brand, it's not as if people are using Xbox as some kind of gateway into using Office or something.

You are right that set-top PCs are a no-go but if exclusive console hardware is ultimately discontinued then their platform is Windows. I don't know if MS is willing to continue to invest the billions they already have with little or no effect. No one cares about Xbox outside of North America and the UK and that's like at most 1/4 of the overall worldwide gaming console market. And right now it's doing poorly compared to it's nearest competitor in NA and UK markets. And this is the third generation of Xbox.

At some point, MS will have to wonder how much more money they plan to throw down this pit until there is a result and if that is going to be worth it going forward as a business concern. I really think there will be very hard decisions to make soon as to whether they will go forward with the development of an Xbox Two hardware, especially since they seem to be completely unwilling to invest in software development at this point.

 

[momshotdad]

Total Xbox Income - (RROD + R&D + Software creation + Marketing + OG investment) is absolutely still negative. A bunch of great quarters don't make up for the RR or R&D in the long term.

 

[catpurrcat]

They almost certainly can continue on like this indefinitely. They shouldn't, but they can. Their profit or loss is mostly a blip on the company's bottom line. And it's currently one of the few industries where everything gets reset every 5-6 years. They've lost phones forever, they've lost tablets forever. No great new product is really going to turn that around. But as PS4 and XB1 are sunsetted, they will have another opportunity to recapture the market.

I think that's why they will probably soldier on for the forseeable future, while trying to leverage their strength in the PC space through cross-play and cross-buy.

This is a good analysis. I'd also add the value they get from simply capturing personal info, usage rates, and cross marketing opportunities for the MS and Xbox brand. This stuff isn't captured in annual profits but is reflected in better products and services for the future. Especially with mobile taking over (95% of which is google and apple), the first MS product for upcoming generations going forward is going to be Xbox, not Windows (3.1 or 95 or Office, like it was for us).

 

[daman824]

Buying Mojang isn't because of Xbox, otherwise they would have discontinued all the other versions of Minecraft on other platforms.

Bone X seems like it's very much the last attempt from a heavily under pressure Xbox division to prove it's financial worth. It's unlikely to have cost much to develop since it's based on the same technology as the Bone and it has literally zero exclusive game support whatsoever so it's obvious it's being done on a shoestring budget.

If anything, Bone X is the last chance, if it fails to move the needle on hardware (which it probably won't) then MS will start winding Xbox down and probably exit the console hardware business at the end of this generation. There won't be an Xbox Two, instead they'll switch to pushing set-top form factor Windows PC's or something for gaming and remain a minority player in the software market with their few existing franchises.

An Xbox 2 is almost certainly coming.

Phil Spencer has already laid out Microsofts expectations of the xb1x

Referring to the bolded, seeing as how all of the same can be said about the PS4 pro (development cost, tech, and exclusives wise), I think it's safe to say Microsoft has developed the X for the same reason Sony developed the pro.

 

[Justified]

Wonder if an investor "leaked" this info, to stir back up the push to sell-off the Xbox brand as the rumors went not long ago

 

[NolbertoS]

I think everyone unofficially knew this, but Xbox fan zealots don't consider the OG Xbox ad part of the overall cash flow since it was a money pit from day one. Still I'm curious to find out hoe badly in the negative the Xbox Division is. I doubt its severely bad, or else Nadella and Spencer would be singing a different tune. Still, the division as a whole must break even at some point, and whether MS will let that happen is anyone's guess as long term maybe they think if by eg 10-15 years time they decide to spin off, sell or cut thr hardware division.

 

[Raw64life]

Back when they reported Xbox numbers directly it was almost always a net loss. This gen they've been using a lot of clever marketing speak when discussing how profitable Xbox is, which should tell you everything you need to know about how it's been doing recently.

Lord knows how many billions in the red they are on the Xbox brand overall.

 

[Lichter]

I thought that they were on the positive by now, but I think they are making a good amount of money with Xbox from the last few FY.

 

[00ich]

Very hard to believe that especially during the XBX360 days.Hell people were saying that even the Kinect was a success for MS.

But if true then i really hope they manage to turn it around somehow.I dread to imagine a console future with Sony basically having no competition (Nintendo is going more or less their own way.)

Sony will have competition for gaming. Just not high-end set-top box like console gaming. You will have mobile gaming further closing the visual gap, increasingly web-based services, Nintendo, PC, VR.
And Xbox will be on a lot of those.
Having a dedicated box in the living room might just become special interest (again) or even retro.

 

[StarStabbedMoon]

We may never know when or how much Microsoft needs to profit off their gaming division now that it's lumped into the "More Personal Computing" segment of their report, which includes their OS, their hardware, phones, Bing, etc. Sure they'll throw us a morsel every now and then like a random revenue figure, but that's not the same thing as having a clear regulated record that includes data like operating and actual income.

They made the change in 2015 and it probably isn't coming back. It will forever remain a mystery.

 

[RedSwirl]

The impression I was under was that the original Xbox was something like a $4 billion loss for Microsoft, and the Xbox 360 was a slight profit on its own. Don't know about the Xbox One. Maybe what they mean is that the 360 and Xbox One haven't made enough money to cover the loss taken on the OG Xbox.

As I understand it though, the OG Xbox was essentially an investment on what Microsoft then saw as the future -- living room boxes. They thought living room boxes, i.e. consoles, would do to home computing what mobile eventually ended up doing.

 

[statham]

um any money they lost in the past is a sunk cost, only thing MS is worried about if they can make money in the future. Nadella or who ever doesn't care about the billions they lost before. Only what they can make going forward. The past is done.Can Xbox be money making in the future?

 

[eerik9000]

Now factor in merchandising and licensing beyond just software sales...easily double that figure to 300M per year IMO. It wouldn't surprise me if that was heading towards a factor of 3 or 4 times these days. When Minecraft was bought by MS about 50M units were sold, they passed 100M already. There are more streams of revenue beyond software purchases alone.

I have no idea what you are talking about. The year before Microsoft acquired Mojang, they made $128 million profit and in the last fiscal year they made $166 million profit. That includes the whole Mojang AB (software sales, licensing, etc.).

 

[Kilrogg]

Judging by people's reactions they missed this on the previous page, so allow me to repost:

I have updated the large financial results post, copy of which is below...

Updated with Microsoft 2nd Quarter 2010 FY earnings
http://www.microsoft.com/msft/earnings/fy10/earn_rel_q2_10.mspx

Updated with Nintendo / Sony 3rd Quarter 2010 FY earnings
http://www.nintendo.co.jp/ir/pdf/2010/100128e.pdf
http://www.sony.net/SonyInfo/IR/financial/fr/09q3_sony.pdf

	   Sony		    Nintendo	      Microsoft	        Total
Y/E 1998     $902,811,090   $1,023,333,867                      $1,926,144,957
Y/E 1999   $1,102,563,557   $1,301,350,000                      $2,403,913,557
Y/E 2000     $722,738,949   $1,368,207,547                      $2,090,946,497
Y/E 2001    -$449,776,290     $677,576,000                        $227,799,710
Y/E 2002     $629,101,056     $895,872,180   -$1,135,000,000      $389,973,237
Y/E 2003     $935,569,253     $834,333,333   -$1,191,000,000      $578,902,586
Y/E 2004     $627,195,212     $993,161,303   -$1,337,000,000      $283,356,515
Y/E 2005     $419,888,799   $1,056,056,202     -$539,000,000      $936,945,001
Y/E 2006      $69,129,058     $774,478,055   -$1,339,000,000     -$495,392,887
Y/E 2007  -$1,970,923,859   $1,914,666,388   -$1,969,000,000   -$2,025,257,471
Y/E 2008  -$1,079,994,103   $4,322,637,887      $426,000,000    $3,668,643,783
Y/E 2009    -$664,313,787   $5,691,428,301      $169,000,000    $5,196,114,515

Y/E 10Q1    -$413,541,667     $420,843,750      $312,000,000      $319,302,083
Y/E 10Q2    -$653,333,333     $710,655,556      $375,000,000      $432,011,111
Y/E 10Q3     $210,629,750   $2,087,904,452               N/A               N/A

Total				
	     $387,078,407  $24,072,504,822   -$6,157,000,000   $16,004,049,028
				
Full Year Average
	     $103,665,745   $1,737,758,422   -$1,001,857,143      $914,270,499

Profitable Years				
			8		12		   2		    10
				
Non Profitable Years				
			4		 0		   6		     2
				
Average in Loss Year				
	  -$1,041,252,010              N/A   -$1,251,666,667   -$1,260,325,179
				
Average in Profit Year				
	     $676,124,622   $1,737,758,422      $333,000,000    $1,389,625,094

...and a handy note suggested by Stumpokapow:


...and another:


...and another:

Here's the original post, for the rest of the quotes: http://neogaf.com/forum/showpost.php?p=19625451&postcount=103

tl;dr: 6+ billion dollars in losses for the Xbox line up to and including 2007. 2008, 2009 and most likely 2010 were profitable. After that? No idea.

 

[hydrophilic attack]

Welp, I have to say, GOT was pretty lit tonight. We'll see how long it takes until the book thread makes me change my mind

Aaaaanyway,

Pretty much

I mean they're getting 30% cut of every game sold, xbl, EA access, game pass, digital taking over so more money from games, microtransactions, Minecraft, sold the console at a profit originally, released a billion controllers with insane profit margins and a 150 dollar controller

There is literally no way they aren't profiting since the Xbox one. Not to mention all the studio closures aswell which should increase profits.

Nothing at all points to them losing money this Gen as a whole. On the console at times? Sure but no way the Xbox division. It just doesn't line up in any way.

They should increase profits in the future but not in the moment.

International corporations usually view huge lay-offs as an investment with up-front costs that will pay off in the future, but will have to be written off for some time in future accounting. The reason for the up-front costs is severance packages and other costs associated with lay-offs. I'm not sure if severance packages are a thing in the US, but Microsoft have shuttered EU studios lately, and EU countries generally have some degree of employees' rights, in contrast to the US.

From Neogaf member Psychotext.

Interesting. So Microsoft HAS made a profit at some point. Which contradicts what Thurrott said. This means one of the following things:

A) Thurrott is full of shit. Since he was wrong about Xbox never making a profit, he was likely wrong about Xbox not making a profit in the present #loltechjournalism

B) Thurrott was exaggerating about Xbox never making a profit, and actually meant that Xbox almost never made a profit. In this case, it's still possible that Xbox is still not profitable in the present

C) Psychotext's numbers were referring to operating income numbers (as per one of Stumpokapow's handy notes). But, possibly Thurrott was referring to net income (bottom line) which also includes stuff like taxes, interest and huge one-time costs. I leave it to someone who actually knows what they are talking about to determine whether this could actually be the case, whether this distinction at all would make any difference, and which of these numbers would be more relevant. (Also, could hypothetical person who knows what they are talking about tell me whether write-offs for RROD would be included in one of these numbers and not the other?)

D) Thurrott was talking about cumulative profits since day one of Xbox business lol no he wasn't, that number is fucking meaningless for someone like Thurrott, and could we please stop entertaining this as an actual possibility?

 

[meirl]

Finding evidence of the Xbox division being profitable should not be this hard to find.

Psst. The fanboy (he calls himself like that) hate. Also, his opinion is very popular here at NeoGAF.

 

[Ozzy Onya A2Z]

I have no idea what you are talking about. The year before Microsoft acquired Mojang, they made $128 million profit and in the last fiscal year they made $166 million profit. That includes the whole Mojang AB (software sales, licensing, etc.).

Any sources/links to check out those numbers and sales data? I've seen they turned over $443M last fin year so I'd be interested in seeing the profit numbers of $166M you mention.

 

[hydrophilic attack]

It makes them loads of money, which is true whether they have made back the initial investment or not. This is a long-term investment and something they see as a cornerstone of the business for the next few decades. That's a really good return on investment for such a large acquisition.

Yeah, but over how long a time-period are they writing of that huge initial investment?

Psst. The fanboy (he calls himself like that) hate. Also, his opinion is very popular here at NeoGAF.

Well, I see your sarcasm, and I'll have you know that my thread success ratio and my Q/P ratiio are both considerably above average

 

[andthebeatgoeson]

Xbox being the first to be doomed would really be a mess. Here's hoping they can turn themselves around with some decent exclusives

 

[HammerFace]

Yeah, but over how long a time-period are they writing of that huge initial investment?



Well, I see your sarcasm, and I'll have you know that my thread success ratio and my Q/P ratiio are both considerably above average

Lol I'm reading your Q/P model thread and the first post pokes a hole in the model. Haven't gotten very far into the page but did you ever address that critique? Because your reply to it mostly just ignores the issue completely.

Also in your prior post you mentioned that the cumulative profits are meaningless, why is that?

 

[Humdinger]

Judging by people's reactions they missed this on the previous page, so allow me to repost:
[....]

tl;dr: 6+ billion dollars in losses for the Xbox line up to and including 2007. 2008, 2009 and most likely 2010 were profitable. After that? No idea.

Some additional data, reportedly based on MS financials. It includes up to FY 2012. 2008 to 2012 are all profitable, but they're still in the hole overall.

https://www.neowin.net/news/report-microsofts-xbox-division-has-lost-nearly-3-billion-in-10-years

 

[Liliana Eileen]

Welp, I have to say, GOT was pretty lit tonight. We'll see how long it takes until the book thread makes me change my mind

Aaaaanyway,




They should increase profits in the future but not in the moment.

International corporations usually view huge lay-offs as an investment with up-front costs that will pay off in the future, but will have to be written off for some time in future accounting. The reason for the up-front costs is severance packages and other costs associated with lay-offs. I'm not sure if severance packages are a thing in the US, but Microsoft have shuttered EU studios lately, and EU countries generally have some degree of employees' rights, in contrast to the US.



Interesting. So Microsoft HAS made a profit at some point. Which contradicts what Thurrott said. This means one of the following things:

A) Thurrott is full of shit. Since he was wrong about Xbox never making a profit, he was likely wrong about Xbox not making a profit in the present #loltechjournalism

B) Thurrott was exaggerating about Xbox never making a profit, and actually meant that Xbox almost never made a profit. In this case, it's still possible that Xbox is still not profitable in the present

C) Psychotext's numbers were referring to operating income numbers (as per one of Stumpokapow's handy notes). But, possibly Thurrott was referring to net income (bottom line) which also includes stuff like taxes, interest and huge one-time costs. I leave it to someone who actually knows what they are talking about to determine whether this could actually be the case, whether this distinction at all would make any difference, and which of these numbers would be more relevant. (Also, could hypothetical person who knows what they are talking about tell me whether write-offs for RROD would be included in one of these numbers and not the other?)

D) Thurrott was talking about cumulative profits since day one of Xbox business lol no he wasn't, that number is fucking meaningless for someone like Thurrott, and could we please stop entertaining this as an actual possibility?

Wow. And that's /thread right there.

 

[Nightengale]

Just to put "current profitability" into context a bit -

Sony's PlayStation business in the past 2 years, is in the 13-14 billion revenue range.

In 2015, the operating margins for the fiscal year was 5.7%
In 2016, it rose to 8.2%

Those are very low profit margins.

It is not improbable that a company of a similar business structure, but has historically chosen to pursue more aggressive pricing strategies, as well as diminish areas of potential additional profit ( BC ), on top of being less successful overall -

Could end up in a situation where they're actually in a net loss.

 

[JusDoIt]

I hope they can get to profitability. I'm not a big fan of Xbox this generation, but console gaming is a lot healthier with them in the mix than I fear it would be without them. If they fold, Nintendo and Sony would carve out their comfortable markets and never compete directly, and I doubt anybody would step in and fill the void (Google, Apple, Facebook, and Amazon would have been jumped in if they wanted to).

 

[Shpeshal Nick]

If this is still the tired old "from its inception" chestnut then it's incredibly disingenuous.

 

[Mikey Jr.]

They've NEVER been profitable?

Really? I find that hard to believe. Even with the 360?

 

[JusDoIt]

They've NEVER been profitable?

Really? I find that hard to believe. Even with the 360?

RROD was a disaster.

 

[Banjo-Kazooie]

Mojang cost Microsoft $2.5 billion dollars and generates about $150 million profit per year. Need to wait a decade (and hope Minecraft stays relevant) until it starts making them loads of money.

That's not how it works. They "broke even" on their purchase after a year

Welp, I have to say, GOT was pretty lit tonight. We'll see how long it takes until the book thread makes me change my mind

Aaaaanyway,




They should increase profits in the future but not in the moment.

International corporations usually view huge lay-offs as an investment with up-front costs that will pay off in the future, but will have to be written off for some time in future accounting. The reason for the up-front costs is severance packages and other costs associated with lay-offs. I'm not sure if severance packages are a thing in the US, but Microsoft have shuttered EU studios lately, and EU countries generally have some degree of employees' rights, in contrast to the US.



Interesting. So Microsoft HAS made a profit at some point. Which contradicts what Thurrott said. This means one of the following things:

A) Thurrott is full of shit. Since he was wrong about Xbox never making a profit, he was likely wrong about Xbox not making a profit in the present #loltechjournalism

B) Thurrott was exaggerating about Xbox never making a profit, and actually meant that Xbox almost never made a profit. In this case, it's still possible that Xbox is still not profitable in the present

C) Psychotext's numbers were referring to operating income numbers (as per one of Stumpokapow's handy notes). But, possibly Thurrott was referring to net income (bottom line) which also includes stuff like taxes, interest and huge one-time costs. I leave it to someone who actually knows what they are talking about to determine whether this could actually be the case, whether this distinction at all would make any difference, and which of these numbers would be more relevant. (Also, could hypothetical person who knows what they are talking about tell me whether write-offs for RROD would be included in one of these numbers and not the other?)

D) Thurrott was talking about cumulative profits since day one of Xbox business lol no he wasn't, that number is fucking meaningless for someone like Thurrott, and could we please stop entertaining this as an actual possibility?

It means what most of us (except Chobel) have thought. IMO Paul was talking about overall since the beginning they are not "profitable". They have had plenty of quarters of "profit" sure, but overall it's going to be in the red (OG Xbox, RROD). The reason I posted in the other topic with links to Nadella was because people were questioning Xbox One being profitable TODAY. From Nadellas statement it seems they are in a "profitable state". People can take that how they will but I take it as the common definition of the term for that when brought up in financial calls and briefings

Edit: or Thurott is just confused about something, somewhere, somehow

 

[Man God]

They've NEVER been profitable?

Really? I find that hard to believe. Even with the 360?

They spent an incredible amount of money building the various studios they did with the original XBOX.

 

[borges]

Microsoft as a whole needs some major restructuring. I don't know how that company is profitable period.

azure, office, office 365, windows, business systems.

 

[Bluth54]

RROD was a disaster.

It's funny how many people seem to forget Microsoft added 2 years to the 360 warranty because of the RRoD and how widespread it was.

 

[hydrophilic attack]

Lol I'm reading your Q/P model thread and the first post pokes a hole in the model. Haven't gotten very far into the page but did you ever address that critique? Because your reply to it mostly just ignores the issue completely.

nah, it addressed the issue beautifully

Also in your prior post you mentioned that the cumulative profits are meaningless, why is that?

because companies (and investors) don't really care about sunk costs from 15 years ago, and thurrott should know that his readers wouldn't care about it

 

[Leafhopper]

It's funny how many people seem to forget Microsoft added 2 years to the 360 warranty because of the RRoD and how widespread it was.

I didn't know it was that bad. I mean I knew how widespread RRoD was but sheesh.

 

[KageMaru]

I guess this could be true if they include the OG Xbox but wasn't that considered a sunk cost to get their foot in the door? I thought companies were not meant to recoup sunk costs and wrote them off as a result. Not sure if this is the case though.

 

[Crayon]

Even if they are set on winding it down, I can still see an Xbox 2 coming in that timeframe. It could take a few years.

 

[blakep267]

Mojang cost Microsoft $2.5 billion dollars and generates about $150 million profit per year. Need to wait a decade (and hope Minecraft stays relevant) until it starts making them loads of money.

That's not how it works. First off it was purchased with money stored off shores that couldn't be brought back to the US because they'd have to pay taxes on it. Minecraft itself has sold 70+ million copies since the purchase and that doesn't count the spin off. It also allows MS to use it for education purposes. Also it's not counting the DLC proponent and any licensing. It's not about just recouping the money, which they will do in far less than 10 years

 

[hydrophilic attack]

Lol I'm reading your Q/P model thread and the first post pokes a hole in the model. Haven't gotten very far into the page but did you ever address that critique? Because your reply to it mostly just ignores the issue completely.

Also in your prior post you mentioned that the cumulative profits are meaningless, why is that?

oh, and i want to add that while that Q/P thread is not my most objectively successful thread ever (that would be my thread about vegans) it is probably my personal favourite (except possibly for my gaming industry fanfiction OT which was objectively a huge failure since it only ever got 38 replies, and has an OP that is now incredibly outdated)

 

[Banjo-Kazooie]

nah, it addressed the issue beautifully



because companies (and investors) don't really care about sunk costs from 15 years ago, and thurrott should know that his readers wouldn't care about it

He should also know his readers probably don't care to see him continuously whine about what beta ring of the Xbox he's in...but he still does it anyways

PS: now I have to go watch GoT since you seem to be pretty high on it tonight!

 

[lifetimeofnot]

I mean, many people on gaf have interpreted recent (misleading) statements from Microsoft as if it actually is turning a profit, recently

Also, it is surprising, at least to me, that even during the height of 360 success, they never turned a profit

Oh, they turned a profit. Then half of there systems died.... the money spent digging themselves out of that hole was enough to make turning a profit for that gen damn near impossible.

 

[Steelyuhas]

Microsoft as a whole needs some major restructuring. I don't know how that company is profitable period.

lol

28% net profit margin last quarter, they are an extremely profitable company