Xbox celebrates profitable year as 360 hardware sales rise

Microsoft’s Entertainment and Devices Division, which includes its Xbox 360 and Zune operations, has announced its first full year of profitable operations, with the fiscal year ending June 30th ’08 bringing $426 million in profit.

This compares to the $1.9 billion loss the Division suffered in the previous fiscal year.

In this period Microsoft sold 8.7 million Xbox 360 consoles worldwide – an improvement on the 6.6 million sold in the year before.

360 was named as the driving force behind the annual results, with PC and Xbox revenue (which includes sales of 360 and PC games, hardware sales and Xbox Live revenue) increasing 41 per cent to $1.7 billion.

Microsoft added that revenue was decreased by $683 million as a result of the $1.1 billion incurred as a result of its extended warranty scheme created to address the console’s ongoing technical reliability problems in 2007. R&D expenses were also up by $242 million and marketing expenses increased by $93 million.

Looking at the results for Q4 08 ending June 30th, EDD suffered a loss of $108 million, but again this was a massive improvement on the $1.2 billion loss suffered in the same period the year before. Xbox 360 platform sales for the quarter were up 35 per cent to $234 million.

As for Microsoft as a whole, revenue for the fiscal year hit $60.42 billion, an 18 per cent increase over the year before. Quarterly results saw revenue of $15.84 billion, which also represents an 18 per cent increase.

Delivering $60 billion in annual revenue is an outstanding accomplishment and a testament to the powerful combination of great technology solutions and strong execution by our partners and global sales and marketing teams,” Microsoft COO Kevin Turner stated. The outlook for fiscal year 2009 is positive given the breadth of our impressive technology portfolio and the expanding collection of online services we are bringing to market.”

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