Microsoft E&D Q3 Losses Fall to $315M, Sales Down To $929M

Microsoft has released its third quarter results, showing the company's Xbox-encompassing Entertainment and Devices division posting a $315 million loss and sales slipping 21 percent to $929 million, as the overall company saw $4.93 billion in profits and $14.40 billion in sales. The $315 million loss is down 22 percent from last year's $402 million, and came as the quarter saw $929 million in sales, down 21 percent over last year's $1.18 billion. Microsoft says the drop in sales came primarily because of decreases in the sale of Xbox 360s. During the quarter, the company shipped a half million consoles, as compared to 1.7 in the third quarter of 2006, that being the first full quarter in which Xbox 360s became available. Sales of Xbox and PC games decreased 44 percent over the company's first three quarters to $393 million, which the company puts hand in hand with the decrease in console sales. Quarterly losses were blamed on expenses related to the launch of Microsoft's Zune media player, as well as expenses from a lengthening of the Xbox 360's warranty period. For the first nine months of Microsoft's fiscal year, decreased losses were also chalked up to an overall increase in Xbox 360 sales and improved margins on the console. Looking forward to the full fiscal 2007 year, Microsoft has said it expects increased sales due to the increased availability of Xbox 360 over the year, as well as sales of its Zune.