Xbox One burns £238m hole in Microsoft pockets after lacklustre launch
Microsoft's next generation video game platform, the Xbox One, has lost £238m since it was released in November 2013, according to a company report.
The figure largely accounts for disappointing sales of the expensive-to-produce console followed by an extensive advertising campaign which included the likes of Breaking Bad actor Aaron Paul.
However, most consoles make loses in the year following release - and do so - until more consoles are sold. Rival Nintendo last month blamed a £57m first half loss on poor sales of the Wii U.
With 11.7 million Xbox Ones being sold in the last financial year, Microsoft took £1bn in total revenue from its gaming department however the launch cost £1.25bn resulting in an overall loss of £238m.
The Xbox One is projected to enter profit later this year as the audience for the console grows in anticipation of the arrival of more appealing game titles.
Microsoft said: "Xbox Platform revenue increased $1.7bn or 34 per cent, due mainly to sales of Xbox One, which was released in November 2013, offset in part by a decrease in sales of Xbox 360.”
Sony is currently winning the ‘console war’ with its PS4, recently recording a profit with its gaming device, selling a total of 36 per cent more consoles than Microsoft worldwide.
In February, Sony shifted six million PS4s to Microsoft's three million Xbox Ones.
This comes as Microsoft saw a seven per cent decline in profit in the second quarter of the year after acquiring Nokia’s mobile department.