Microsoft entertainment division turns profit, thanks Halo
by Ross Miller 
{ Oct 25th 2007 at 7:54PM }
Of course, Uno for Xbox Live Arcade can't account for all of the extra money. We'd like to think a certain record-shattering Spartan soldier had something to do with it.
Microsoft Corporation itself had an operating income of $5.92 billion and revenue of $13.76 billion. That's a 27% revenue increase over same time last year, reportedly its biggest increase since 1999.
See Also:
Losses in Sony's games division double
Nintendo ups profit's forecast, incoming money storm
Reader Comments (Page 1 of 3)
gonk @ Oct 25th 2007 7:58PM
kudos to the MC
RedJoggingSuit(MSDF-Battle Angel) @ Oct 26th 2007 12:14AM
Your welcome, Microsoft.
Necki @ Nov 1st 2007 5:25PM
Indeed, its hammer time.
RolexDPracer @ Oct 26th 2007 7:46AM
Way to go MS!!!
FM @ Oct 25th 2007 8:08PM
So now MS is on the same level of Nintendo..printing money.
gonk @ Oct 25th 2007 8:08PM
except the 360's are probably still sold at a bit of a loss
Spartacus @ Oct 25th 2007 8:10PM
No gonk, MS reported they have been making a profit on the 360 hardware some time ago.
Rubang B (NDF - Heart) @ Oct 25th 2007 8:14PM
No. Not in the same galaxy.
Microsoft's games and devices division made its first profit in what... ever? And it was an operating income of $165 million? That's chump change to Nintendo. That hardly offsets the billions they've dumped into the red over the last couple years. Nintendo just TRIPLED its profit forecast for the fiscal year. $3.7 billion in one year. If Microsoft makes $165 million all 4 quarters they'll make less than 20% of what Nintendo's expected to make.
gonk @ Oct 25th 2007 8:24PM
oh sparty, cool
Rubang B (NDF - Heart) @ Oct 25th 2007 11:34PM
Whoa, I didn't expect to get whited out there. I didn't mean that to be Haloz bashing or 360 bashing if I came across like that. I think we all know that the division behind the 360 BLEEDS money and is entirely funded by Microsoft Windows and Microsoft Office. Congrats for finally getting in the black, but I think a comparison to PRINTING money is not yet appropriate.
Komamura @ Oct 25th 2007 8:11PM
well it looks like sony is the only one losing money out of this console wars game. even with the RROD thing MS still managed to pull a profit
Flashover @ Oct 25th 2007 8:17PM
Of course M$ made money BECAUSE of the RRoD... a quarter of its customers had to buy more than one system...sometimes three...Just wait till they have to actually start honoring their three year warranty b/c the systems are still crashing like the bandicoot.
JerJerBinks @ Oct 25th 2007 8:22PM
Yep, and it only took 2 years of the the 360 to turn a profit. Its possible, although highly unlikely, that Sony might be able to turn a profit a year from now when the PS3 is 2 years old.
DWells55 @ Oct 25th 2007 8:21PM
From Engadget:
"Microsoft has expanded its warranty coverage to three years, and will take a $1.05 billion to $1.15 billion charge to earnings for anticipated repair costs on the malfunctioning consoles."
Yeah, those red rings of death are certainly bringing in a lot of money for Microsoft. Nothing says "profit" like $1 billion+ in losses.
gonk @ Oct 25th 2007 8:22PM
what?
i doubt 20% of 360's are a 2nd system, that'd be crazy
Marty @ Oct 26th 2007 2:01AM
You know what I love? People acting like others buying multiple systems is a bad thing. Yes, I realize that the PS3 hasn't had any serious hardware issues yet, but I've yet to see anyone buy a second system for any reason whatsoever. It says a lot about the overall quality of experience that the 360 offers when people will buy multiple systems to play the games, or wait for their Xbox to be repaired over and over again.
Slaziman @ Oct 26th 2007 9:09AM
Flashover, please stop with your douche statements. If people actually BOUGHT three 360's, then it shows just how awesome a 360 is that some people would drop 1200$ on it.
VampireHunter Z @ Oct 26th 2007 11:27AM
Regarding the $1 billion set aside for warranty. First of all it's for 3 years. That's $333 million a year. As time go by the hardware gets more efficient. Right now the hardware is more reliable than it was earlier this year. I've done some math and I think MSFT will end up eating some of that billion. I don't think they will need to spend all of it a repairs.
Awesome Stuff @ Oct 26th 2007 11:42AM
@ FlashOver
Like the PS2 and its Disk Read Errors? I'm SURE you had more than 1 PS2 within 1 year or so because I know I did. =/
Komamura @ Oct 26th 2007 12:04PM
@Awesome Stuff
At least MS will replace it for you. If i remember correctly Sony said tough shit about about the PS2's DRE problems
Spartacus @ Oct 25th 2007 8:09PM
So in one day the 'stiq reports financial hoorah for Nintendo and now MS and financial stress for Sony... Big news day.
Also, congrats MS, you've waited a looooooong time for this.
ukickmydog (NDF - Earth) @ Oct 26th 2007 10:42AM
where the hell is SDF talking shit about MS now?
DWells55 @ Oct 25th 2007 8:09PM
Halo makes money for Microsoft? Shocking!
Flashover @ Oct 25th 2007 8:11PM
Whoopty-frickin' do. Bill Gates made more money. That is reason to celebrate.
DSR7997 @ Oct 25th 2007 8:21PM
These comments show that when you are down, Sony, people will kick you. When you are up, Microsoft, people will try to drag you down to their level. You people are inmpossible to please.
Rususeruru @ Oct 25th 2007 8:24PM
eat your cake! now you too can sit on uncle bill's lap and tell him what you want for christmas!
Crono (NDF - Knight of the Old School) @ Oct 26th 2007 8:35AM
THE CAKE IS A LIE!
FM @ Oct 25th 2007 8:20PM
@Spartacus
I thought it was the contrary since 360's are cheap to make,right?(the whole hardware profit thing)
Voltron @ Oct 27th 2007 12:28AM
Flashover you sir are a moron.
Long Bow @ Oct 25th 2007 8:26PM
This isn't much of a surprise to be honest. We are talking about the most powerful software company in the world. They know how to do business and sell software. I wouldn't be surprised to see Halo 3 being the deciding factor on X360's success. I won't be surprised if I see Halo 3 sell 10 million copies in the next 1.5 years.
umm....hello??? @ Oct 25th 2007 8:22PM
Let there be cake!?!! Do you not know??
The cake is a lie...
The cake is a lie...
The cake is a lie...
ZippyDSMlee @ Oct 25th 2007 8:28PM
Question has MS paid off its 5ish billion debt?Ya the RROD thing paded
the unit sales by 30ish percent in my suck arse estimates but unit
sells alone wont padd their pockets much.
-------------------------
Flashover
the point dear is that MS went into this like 5ish billion in the red, and they took losses on the 360 for the first year or 2...
UnnDunn @ Oct 25th 2007 9:53PM
What debt? I think you'll find Microsoft is debt-free, in fact, they have something on the order of $40bn sitting in the bank collecting interest.
Yes, the Entertainment and Devices division (of which Xbox comprises a large part, but not the whole) has lost $5bn over the years, but Microsoft as a whole has never lost money in that time.
Rwing90 @ Oct 25th 2007 8:44PM
Did MS break out how much of a drag Zune was on those results? (I assume not, just checking.)
ColossalHat @ Oct 25th 2007 8:42PM
So they've only made about $23 million dollars in that division in the last two years?
kennethrios @ Oct 25th 2007 8:45PM
So...
The Wii/DS print money, the PS3 eats money and the 360...?
ColossalHat @ Oct 25th 2007 8:48PM
Prints Monopoly money!
Psaakyrn @ Oct 25th 2007 8:49PM
The 360 keeps all the money.
But seriously, the true test would be when all the heavy hitters come out for the Wii and PS3. Microsoft gets to enjoy their lead (like their console lead, but will they maintain the lead when the games starts being released, like how the Wii conveniently stepped in front of the 360 then it came out?
(Granted, technically Nintendo is still in the lead, so this analogy doesn't really make sense. Ah well.)
jsn @ Oct 26th 2007 12:05AM
It will dominate both in software sales over the holiday season and well into next year. It won't even be close. They'll probably move 10mil units of games over the holiday season. PS3 and Wii won't like touch that combined.
Crono (NDF - Knight of the Old School) @ Oct 26th 2007 8:38AM
Microsoft is predicting 7 million, and I think thats a stretch.
Wii's will sell out, of this there is no doubt. Its all a matter of how many Nintendo can make. If nintendo has made 10 million (worldwide) for holiday season, they will all sell.
Awesome Stuff @ Oct 26th 2007 11:52AM
PS3: Nom nom nom
Flashover @ Oct 25th 2007 8:46PM
Hey Gonk.
http://techdigest.tv/2007/06/xbox_360_failur.html
gonk @ Oct 25th 2007 8:49PM
so? we already knew that
that doesn't mean people buy a 2nd one, they send their 1 into MS to get repaired/replaced/exorcized
Synner @ Oct 26th 2007 6:05AM
Hey Flashover:
www.amishrakefight.org/gfy
I can post links too, arrent I special?
Douche
G @ Oct 25th 2007 8:48PM
Why does everyone have to slate Bill Gates? He made a fortune, well done to him.
As for Halo raking in money? Yeah we know it was going to. Microsoft do actually try to make a profit as a company (and succeed). Congratulations to them for turning their 2nd generation console into a profit when there was actually something to compete against. (Playstation 1 did not have a challenge with my much loved Dreamcast).
I wish Sony a good turn around next year and with some of their exclusives I may just get myself a PS3. In the meantime, Nintendo damn you for bringing out Samba di Amigo soon :-)
So uhh, yeah, well done on the profit thing.
ColossalHat @ Oct 25th 2007 8:54PM
"Why does everyone have to slate Bill Gates? He made a fortune, well done to him."
I hate him because he stole most of the ideas he brought to the market from others and stepped on his colleagues and friends for financial gain. I also hate him because (puts on a beat up fedora) he bought a notebook of Da Vinci's which belongs in a museum.
Vegeta (aka Ska Oreo) @ Oct 25th 2007 9:12PM
ummm that's a pretty gay reason to hate someone.
Synner @ Oct 26th 2007 6:02AM
"it belongs in a museum"
"so do you, Dr. Jones"
A big +1 for you Mr. Appropriate movie quote guy.
Korova @ Oct 26th 2007 7:23AM
Both of your posts are the reasons why xbox exists in the first place. To delete the hate for Bill Gates and MS and raise a generation of fanboys. That's why the 5bln hole is not a big deal, because when xbox division was started people and government was talking about breaking MS up into pieces, which is what happens with monopolies.
Instead MS distracted baby with a pwetty toy and then an even pwettier toy.
It does print money, in ways one can hardly imagine.
josh @ Oct 26th 2007 1:40PM
Gates has also used his money to save literally MILLIONS of lives through the Bill and Melinda Gates Foundation. I have always disliked Microsoft's business practices, but Gates is at least trying to help the world and his fellow man (and doing a pretty good job of it). That counts for alot in my book.