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Newsletter Issue #739: A Few Tidbits about Microsoft’s Financials

From reading much of the press chatter about Microsoft’s quarterly financials last week, you almost had the impression that the Surface tablet had been a huge seller. Almost. Although revenue, at $893 million, doubled from the previous quarter, Microsoft is still selling a paltry amount compared to the iPad.

Let’s assume, for the sake of argument, that Microsoft received $400 from each sale after the dealers and distributors got their share. That would amount to some 2,232,500 units sold. However you break this down, however, that number isn’t very impressive.

Worse, it cost Microsoft $932 million to deliver that $893 million in sales, so chalk up yet another loss for the Surface tablet, though it’s nowhere near as bad as 2012 when the company took a $900 million write-down on the product. There’s something to be said for progress, because it means Microsoft may actually earn a profit from the Surface one of these days.

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