Microsoft Announces Xbox-Related Financial Results

As part of its financial results which included overall revenue of $9.19 billion for the quarter ended September 30, 2004, a 12% increase over revenue of $8.22 billion for the same period in the prior year, Microsoft today announced that its Home and Entertainment division, which includes sales of Xbox hardware and software, posted revenues of $632 million, up 9 percent from the year before. "Higher than expected sales of Xbox games" were particularly mentioned in relation to this shift, which saw the division incur a loss of $142 million, compared to the much more significant $273 million loss in the previous year. Robbie Bach, senior vice president, Home and Entertainment group, commented: "Xbox continues to be the only platform to show year-over-year growth and has now outsold Sony PlayStation 2 for two months in a row in the United States", and pointed to the imminent release of Halo 2, for which there are already 1.5 million pre-orders, as a sign of continued success for Xbox. Although $142 million is still a significant amount to lose in one quarter on Home and Entertainment properties in general, Microsoft still has $64.4 billion in the bank, meaning it is likely to be able to bankroll the Xbox and its follow-ups for some time to come, especially with the overtly improving fortunes shown in these results.