Xbox One Should Break Even At Launch, May Turn A Profit
Yesterday we reported on the new pre-order numbers for the PlayStation 4 and Xbox One as of August 24th. In light of Microsoft‘s estimated 350,000 domestic pre-orders for the Xbox One, Yusuf Mehdi has stated that the Xbox One will likely break even when it launches on November 22nd. There’s even a possibility that the hardware turns a profit.
“The strategy will continue which is that we’re looking to be break even or low margin at worst on [Xbox One] and then make money selling additional games, the Xbox Live service and other capabilities on top,”
Which is typically the status quo when it comes to new gaming hardware hitting the shelves. Companies like Nintendo, Microsoft and Sony see the lionshare of their profits when software is sold for use on their systems. Mehdi was also confident Microsoft would be able to optimize production and rely on the ever present decrease in hardware prices to make even more money off the Xbox One in the future.
“And as we can cost-reduce our box as we’ve done with 360, we’ll do that to continue to price reduce and get even more competitive with our offering.”
Medhi happily stated that the Xbox 360 is still “incredibly profitable” after nearly eight years on the market. How many games are you planning to pick up at launch? Let us know in the comments section below.
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