Unlike its predecessor, Microsoft's Xbox 360 is bringing in some serious cash. Microsoft recorded record revenues for the three months ending December 31, 2006. The company's Entertainment and Devices Division (which includes Xbox 360 and the newly-released Zune) brought in $2.94 billion, a 76 percent rise in revenue over the same three-month period last year. Despite the healthy revenue stream, the division suffered a net loss of $286 million, equivalent to the same losses suffered the year prior.
In the quarter, Xbox and PC game revenue increased by $1 billion and 4.4 million 360s were sold. To date, Microsoft has sold 10.4 million Xbox 360s, topping its own forecast of 10 million units by this time. The software giant can find encouragement in the financial success of Xbox 360 during a period that saw the launch of two competing consoles.
Microsoft expects increased profitability over the second half of its fiscal year thanks to increased availability of Xbox 360. The June release of BioShock shouldn't hurt either.
Overall, Microsoft's profits were down 25 percent for the quarter.