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Xbox One – Microsoft will either break even or make a profit at launch, says Mehdi

Thursday, 5th September 2013 21:29 GMT By Stephany Nunneley

Microsoft plans to break even or make a profit with Xbox One at launch, according to chief marketing officer Yusuf Mehdi.

Speaking during the Citi Global Technology Conference this week, Mehdi teh firm’s strategy is to either “break even or low margin at worst and then make money selling additional games, the Xbox Live service and other capabilities on top.”

“You’ve seen us over the years constantly be focused on profitability and improving year over year,” Mehdi said. “Rhere are different points in the cycle when you invest in new hardware.

“If you look at 360 that platform lasted for seven to eight years and it’s going to go for another three years. It’s incredibly profitable now in the tail. Some of these things take some time in the launch year in which you invest, and then they they play out over time.

“We’re going to continue to invest in Xbox 360, and the two devices can work in concert. So it’s not like the day we ship Xbox One your 360 won’t work. We’ll continue to support it.”

Xbox One will release on November 22 in 13 territories.

Thanks, GI International.

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17 Comments

  1. mistermogul

    I’d hope so too at that price!

    #1 12 months ago
  2. bradk825

    Good to know. If they are making money right away they can invest it right away. We saw things happen over time with Xbox 360, as they made more money we got more apps, more exclusives, more exclusive content etc…

    #2 12 months ago
  3. noamlol2

    microsoft has lost it’s touch

    the adds on the 360 keep mocking the people who pay for gold

    not giving a damn about players who reported cheaters in certain games (dark souls)

    and having one of the most poor,overpriced digital marketplace in existence
    i’m sure MS will never win the next gen like they managed to do this gen

    #3 12 months ago
  4. laughing-gravy

    Both next-gen platforms have been designed with reduced manufacturing costs in mind. So hopefully we as gamers can see the benefits with increased investment in services and games. Better online and first party would be the obvious candidates. Timed exclusives p**s me off though.

    #4 12 months ago
  5. CyberMarco

    I find hard to believe that huge companies like MS/Sony/Apple and the likes declare that the have “limited resources for investment”, or state that they desperately need their product to not only succeed, but even break any previous record.

    I mean, how sure are we that they aren’t evading the taxes, or concealing their real profits/capital?

    #5 12 months ago
  6. Major Mayhem 70

    But, but, but it comes with the Kinect. How can this be true?!? All the 180s, this can’t happen?!? The price point alone should have sunk this ship already!!!

    Just being facetious 😜 Hope it works out for both companies. The more success they have the better we the gamers benefit as well.

    #6 12 months ago
  7. DanMcGrew

    @3 whats wrong with the xbox marketplace more often than not games/ dlc are cheaper on xbox than on psn here in the uk anyway

    #7 12 months ago
  8. Major Mayhem 70

    @cybermarco
    I work for a big corporation and trust me its all about keeping the board members and investors happy. Just cause your a billion dollar business doesn’t mean they want to spend billions of dollars. Spend what you need to get the product out and no more. Evading taxes and getting caught is a bigger risk and cold topple a companies reputation if caught. Pay your taxes and practice smart business management. This tactic has been the tactic of all successful companies. The three you spoke of have been around for years and aren’t going anywhere any time soon.

    #8 12 months ago
  9. pukem0n

    or pay your taxes in luxembourgh in europe, just like apple/amazon or ebay do it and you save alot.

    also i think MS made it a bit pricier than the PS4 on purpose to cut the price really fast once sales are inevitably dropping in 2014.

    #9 12 months ago
  10. Opalauge

    fact is, the XBO is produced by other companys just like all of its components. MS is paying for their production and assembly. they are most certainly not paying for shipment and storage of the components.
    they also calculate with the expected gold memberships and additional services.
    it has an positive aspect: they have all possibilitys to subsidize the XBO. that is definetly an advantage compared to sony.

    @3

    the marketplace ist shitty and expensive compared to what??? ever used it? own a 360? I doubt that!
    compared to Steam it has many flaws but also benefits. however, it is more expensive. compared to the PSN it’s better in every single way.

    #10 12 months ago
  11. Legion

    @3 You are clueless. Do you even have XBL or use the dashboard? Where are all these ads you keep talking about? that are “mocking the people who pay for gold”?

    Is it that 1 movie trailer in the corner that I can check out if I want on the movie dashboard? Or is it the 1 music video in the corner when I go to the music dashboard area? Maybe it is the 1 avatar free download I am checking out in the games dashboard area? Any ad is specifically relatable and adds value to me as a player.

    And as for “most poor,overpriced digital marketplace in existence”… have you even purchased anything on the marketplace? Their prices rival PSN in every way. And guess what… any free stuff they give away. Is actually FREE… and you don’t need to stay a member of XBL to enjoy it. FREE games from PSN… just loaners basically. You can play them as long as you are a PSN member. How is that really FREE?

    Why is it that SonyFanboys are so concerned about my Xbox gaming experience?

    #11 12 months ago
  12. dexfx69

    Ever notice how nearly ALL the Xbone “news” on vg247 lately is PR Propaganda from Microsoft, trumpeting all the “positives” and sidestepping the glaring facts of Microsoft trying to shaft users with their original Xbone policies and user privacy concerns? Hmmmmmm.

    #12 12 months ago
  13. super3001

    ever notice how sony fanboys are such uninformed idiots?

    #13 12 months ago
  14. Lengendaryboss

    @13
    The irony.

    #14 12 months ago
  15. Opalauge

    Those last few months felt like a fu**ing playground with two factions pissing on each others sandcastle.
    Damn, I hope this ends with the launch…

    #15 12 months ago
  16. Hcw87

    @15
    Oh hell no, we’re going to have multiplat titles running side-by-side fueling the war for even longer.

    This is only a mild beginning in comparison.

    #16 12 months ago
  17. bradk825

    @3 MS and Sony are not responsible to ban players of certain games. They do their banning based on abuse of the XBL service, but those who abuse the games are banned, if ever, by the game dev. Treyarch and IW ban CoD players who boost for example. Dark Souls is responsible for itself, not XBL.

    #17 12 months ago

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