Microsoft and Sony Earnings

so, now that everyone is talking about microsoft’s earnings, official xbox 360 sales, et al, i thought i would mention something.

net income for the microsoft’s q4 was $3.65 billion. wow. that’s alot.

to compare, sony’s recent earnings announcement (which was good, thank god) elicited such exclamitory statements as “Stringer’s Sony Startles With Strong Profit” and “Profit Jumps at Sony” and “Sony’s Net Climbs 18% to Record; Competition Might Curb Outlook” were less than half of microsoft’s net income at $1.5 billion.

what really is interesting in all of this is their profit vs. revenue comparisons for the same quarter.

sony:

  • $66.5 billion gross revenue
  • $1.5 billion net earnings
  • 2.2% profit.

microsoft:

  • $11.8 billion gross revenue
  • $3.65 billion net earnings
  • 31% profit

microsoft has 15x the money to throw around to make the xbox 360 work. they have 15x the money to push into the living room. they have 15x the money to float them through to a ‘convergence’ victory.

m3mnoch.

p.s.  i was just thinking i should qualify “15x the money” as effectively “wiggle room.”  meaning, earning potential.  meaning cash in the warchest.  meaning shareholder love.  not necessarily representative of the ‘only’ 2.4 times the literal profit.

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2 comments so far

  1. paradox on

    Well, maybe linux and apple are going to steal a slice of their pie soon, huh?

  2. m3mnoch on

    eh. i dunno. i don’t think they care. maybe they’ll steal large chunks of the desktop space. that’s not where the real money is, tho. i think it’s more of a “look at this hand over here — we’re fighting to maintain relevence in the desktop space! pay no attention to the man behind the curtain…” kinda thing.

    for example, here’s a quote for you:
    “The PC market, though healthy, was no longer booming, and many thought it saturated. In contrast, by 1998, Sony’s PlayStation was already outselling the top five PC makers combined. And gaming software in general was on its way to a 45 percent annual growth rate.”

    the top 5 pc makers combined. back in ’98. what do you think that ratio looks like today?

    nah. there’s not enough future money (relatively speaking, of course) in pc’s to fight any harder than you need to for the desktop. just maintain status quo. the real battle is for the living room.

    what if microsoft owned the software that was on every game console? what if xbox live was the major gateway through which all of those “selling more than the top 5 pc makers combined” electronics are connected in the near future?

    can you say three times the revenue potential in an especially profit heavy, crazily growing business?

    m3mnoch.


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