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Microsoft's Xbox 360 Division Sees $1.32 Billion Profit For Fiscal Year 2011

Microsoft's Xbox 360 Division Sees $1.32 Billion Profit For Fiscal Year 2011

July 21, 2011 | By Tom Curtis

The Entertainment and Devices Division of Microsoft, which includes the Xbox 360, PC games, and Windows Phone, took in a profit of $32 million on top of revenues of $1.49 billion for the final quarter of the fiscal year quarter, alongside record revenues of $17.37 billion for the company as a whole for that period.

Microsoft reports that revenue for the Entertainment and Devices Division grew 30 percent for the fourth quarter 2011, and 45 percent for the full fiscal year ended June 30, 2011, with the increase in revenue primarily indicating money brought in from the Xbox 360 and its related products.

The company noted that the division's operating revenue of $32 million was offset in part by increased costs relating to manufacturing, marketing, and distribution.

These internal costs increased 15 percent to $118 million thanks to higher Xbox 360 sales and production, and increased royalty costs from improved sales of digital content on Xbox Live.

During the full fiscal year, the company took in a profit of $1.32 billion, up from $618 million in 2010. The division also saw an overall revenue increase, again reflecting higher Xbox 360 platform revenue.

For the full year, Xbox 360 revenue grew by $2.7 billion, or 48 percent, led by increased sales of Xbox 360 consoles and Kinect sensors, and higher Xbox Live revenue, said Microsoft. In the fourth quarter, Xbox 360 growth was $293 million, or 29 percent.

Also for the fiscal year 2011, the company said research and development expenses increased $119 million, or 12 percent, primarily reflecting higher headcount-related costs. Sales and marketing expenses grew by $90 million, largely indicating increased marketing for the Xbox 360.

Microsoft shipped 1.7 million Xbox 360 consoles during the fourth quarter, up from 1.5 million consoles during the same period last year, and 13.7 million Xbox 360 consoles during fiscal year 2011, up from 10.3 million in 2010.

The Entertainment and Devices Division covers the company's IPTV software Mediaroom in addition to Windows Phone and Xbox 360 products.

Microsoft at large saw revenue of $17.37 billion for the quarter ended June 30, 2011, an 8 percent increase from the same period of the prior year, and profit of $5.87 billion, up roughly 30 percent from the same period in 2010.

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