Bankruptcy looming? Nah
Everyone knows that Microsoft has been losing a fair wad of cash on it's recent release of Xbox 360 consoles.According to Business Week, Microsoft is currently losing $126 on every Xbox 360 sold.
However, according to Insider Scoop, "A high ranking friend at IBM, one that worked on the Xbox 360 chip design, tipped us regarding the real expenses involved in manufacturing the Xbox 360... 'It costs Microsoft approximately $715 to make, the manufacturing costs are still too high, another reason why they’re producing relatively small quantities.'”
This would put the figure at losses of around $300 per console.
Early figures show that 1.2 million Xbox 360s have been sold so far and Microsoft will sitting in the red for some time. Microsoft have made a bold move in announcing that the Xbox 360 will become profitable by the start of the company's 2007 financial year, which begins in July 2006.
I'd suggest that the only way this will happen is if a game is released that captures the eye of gamers. The original Xbox was only profitable for one month and that was due to the release of Halo 2.
