Summary: Just like on the Web, Microsoft bleeds in the hardware sector and the business is not sustainable
MICROSOFT’S debt cannot be too encouraging to the management. The company’s endless hardware failures are consistent at Microsoft, so the cash cows (Office and Windows) are all that’s left to support the rest. The company has lost billions on Xbox and it still bleeds money there:
Microsoft’s entertainment and devices division, which includes its Xbox business, lost $229 million (£143m) in the three months ending March 31 after sales of Xbox 360 fell by almost half.
The division’s revenue was down 16.5 per cent, to $1.6 billion (£1bn). Xbox 360 sales during the quarter totalled 1.4 million – a drop of more than 48 per cent from this time last year, when 2.7 million consoles were sold and the division’s revenue rose 60 per cent.
As a Nokia expert puts it,”Windows combined market share globally of Windows Mobile and Windows Phone was down to .. 1.3%” (no surprise there).
That cannot be possibly be sustainable and Microsoft cannot catch up with the leaders:
Was Microsoft’s Surface tablet an act of desperation? Yes, says a report in the New York Times.
Microsoft and the PC hardware industry were failing miserably at taking on Apple’s iPad, forcing Redmond’s hand, according to the report.