Microsoft “is betting heavily on the consumer electronics business for future growth, and late last year it introduced a digital media player, Zune, which competes with Apple’s iPod. But Microsoft’s consumer entertainment and devices unit has contributeds no profits yet, losing $289 million in the quarter,” Steve Lohr reports for The New York Times.
Full article here.
The Associated Press reports, “Microsoft Corp. said Thursday its fiscal second-quarter profit fell 28 per cent, as delays from the launch of its new version of Windows cut into holiday-quarter revenue. For the three months ended Dec. 31, earnings fell to $2.63 billion from $3.65 billion… Revenue rose to $12.54 billion from $11.84 billion in the year-ago quarter.”
Full article here.
[Thanks to MacDailyNews Reader “Tom S.” for the heads up.]
[UPDATE: 9:42am EST: Updated headline.]
The figures for Apple’s last quarter: revenue of $7.1 billion and net quarterly profit of $1.0 billion vs. Microsoft’s much larger figures of $12.54 billion and $2.63 billion, respectively. Windows and Office are licenses to print money, it seems, regardless of how such licenses were obtained. Apple generated revenue of $4.061 billion on iPod, iTunes Store sales, iPod services, and iPod accessories vs. Microsoft’s $289 million loss on Zune and CE devices. That’s a differential of $4.350 billion.
Related articles:
The Motley Fool: Apple makes Microsoft’s Zune a paperweight – January 10, 2007
Zune: Apple cannot lose. Microsoft cannot win. – July 26, 2006
Note the number of XBoxes out there are SHIPPED numbers not SOLD. NPD only measures shipped.
Nintendo is at 3.6 million after 2 MONTHs – this is sold not shipped – Sony is lagging behind but should pass MS also by end of 2007 – mainly because MS after a YEAR is nowhere near a million sold in Japan – the 2nd largest console market.
MS has spent around $15 billion to sell 30 million XBoxes. You can do that math – it’s not how much it’s selling for now, it’s the giant hole they have to climb out of.
As for Zune, it is pretty much dead already – MS somehow believes that “average” consumers will buy a flawed product until they get it right – that might work for enterprise software but not for CE gear. Fool us once …
So, for those keeping track, MS is ZERO for consumers since 1995. MSN, MSN search, Talking barney’s, watches, home media pc’s, mobile pc’s, tablet pc’s, bob, webtv, xbox, xbox 360, zune, etc …
As long as the shareholders don’t mind propping up Steve Ballmer’s stock holdings or literally throwing all their profits from Win & Office down the drain … sort of like if P&G decided to sell cars – MS is clueless when it comes to consumers.
you know, reading an overwhelming majority of these posts is a great reminder of why you people are commenting about what happens at Apple or Microsoft, as opposed to working at either. You simply have Zero business accumen, and not enough brains to shut your mouth…
I work at one of those two companies, and I can tell you how reasonable employees at both companies look at some of this stuff….
First of all, we read the posts here and on sites that cater to rabid Microsoft fanboys/girls and we either laugh or get frustrated. We laugh because…come on. At the end of the day, we are a technology company…not a religion. As much as you want to make us one, your ignorance is better saved for sites that debate points where there is no right or wrong. Debate about Buddah and I can’t tell you that you’re wrong….Debate about business fundamentals and you need to know them.
We get frustrated because its tough to read so much ignorance and not be frustrated. I mean, really….You people are like out of shape sports fans who sit on the sidelines and complain about the antics of the superstars…every sentence dripping with what coulda, woulda, shoulda been the right thing to do…had only you been in charge. Well, you aren’t in charge, and you remind us why every time you open your mouth. It seems as though those who yell loudest are the ones with the weakest grasp on business basics.
So, if I work at Apple, here is how I would feel right now: Proud of the work we have done to get this stock moving in the right direction for an extended period of time. Sad that we dropped the word Computer from our name…we liked making those and it feels like giving up in a way. Not that we wont still make them…but I worked here thinking that we were gonna be kings of that someday. I like our iPod business. Who wouldn’t? I am sad that we didn’t drop a big bomb in January other than the iPhone, but Steve wanted that to stand alone. I get that. Our desktop business is struggling, but I want it to. Remember? we are forward thinking…and what sense does a desktop make? I think that iTV is cool, but I am tired of iEverything and wish the price was cheaper. The iPhone will be great, but you do know that we will be losing money for a while on that because of the R&D, marketing, COGS….I wish it wasn’t cingular. I am tired of the pressure to be hip. ANd even though I work here, I don’t have a deluded sense of the history of computing/software/consumer electronics. Steve is cool, but he’s no messiah. If you take your blinders off, you will see that there are a number of things he could have done better. If he sees them, why can’t you?
If I worked at Microsoft and I was given the chance to trade my current XboX business for the current Wii or Playstation 3 business, I wouldn’t do it. Granted, it’s a long road home…but would any of you rather be Sony right now? If so, you need to refer to paragraph one and also do a Google News Search on Playstation 3. Tell me what you think of the general tone of those articles. Positive? Not so much. The Wii scares me, but it’s lack of extensibility makes me worry less. When we begin to roll out additional services over XBox Live that the Wii CAN’T do, I will feel even better. I understand what we are doing with the Zune, and I am glad that you don’t. Here is a good way to know if you understand….Ask yourself, is Microsoft interested in being in the portable media player business? If you said Yes, you don’t understand what is at stake here over the long haul. Itunes may have sold 2 billion songs over the last five years, but that’s only 200 million a year. As you can see, that doesn’t cover the losses in our ED Division.
” width=”19″ height=”19″ alt=”grin” style=”border:0;” /> And if you want to have some real fun, copy and paste all of your comments into a word document and do a search and replace. Replace the word Zune with Xbox, and replace the word iPod with the word Playstation 2. It’s a lot of the same, and here we are 5 years later and the fact that the 360 isn’t a joke, not easily dismissable, and has a good percentage of the gaming public on it’s side….you can understand why we aren’t folding up our Zune Tents just yet. I look at Apple iTV and like knowing that i have been doing the same thing for a year with my 360/MPC. I am tired of 5 year old jokes that further outline your lack of business understanding.
But no matter which of these companies I DO work for, I am still glad that I am not one of you people. Sitting on the sidelines and yelling at the real players….
Welcome to the Social.
@Scratchpantsbobitch… or whatever.
Seek some professional help mate, coz i don’t think that you know who or where you are.
It takes real talent to lose 289 million when you claim your Zune to have “25% of the market”
Ballmer, you a-hole!
> …and not enough brains to shut your mouth… <– LOL
schlmuss – your logic is amazing. tip: when you find yourself in a hole, stop digging.
scratchbobitchpants:
It’s obvious you work for Microsoft, because your commentary was pointless and tedious.
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