Earnings Season: Part Un
Microsoft showed overall strength in its third fiscal quarter report. Nevertheless, the Home and Entertainment segment, which includes the Xbox business, was down 42% ($453 million) from same quarter last year ($778 million), due in part to a natural pullback from last year's post-launch Xbox sales but probably also from a dearth of system-selling software for the platform. MS sold 350,000 Xbox Live starter kits and projects 9 million installed Xbox consoles by the end of next quarter, still leaving it a distant second to PS2. Clearly, Redmond does not expect sales to increase soon, as it gave guidance that Home and Entertainment revenues would dip further next quarter to under $400 million and the sector would be tough to grow next year. Which sounds like Xbox has a lot riding on Christmas and Halo 2.
Next Issue: Earnings capsules on Sony, THQ, EA
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