No profit on Xbox One

John Connors, Microsoft's chief financial officer, spoke to financial analysts in Boston this morning. Among other things, he acknowledged that the company still loses money on every Xbox it sells, and he said that isn't going to change until after the next generation Xbox is released, because of the cost of making the current console. Access the audio of the full presentation through this site. Here's his full quote on the subject of the Xbox:

"The real crossover though, in terms of profitability delta, is when we get to the next generation of the Xbox console. Where we are today in the life-cycle of that console, it’s very clear if you look at previous life-cycles for consoles, that as you get to the end, the pricing dynamic heads one direction, and that’s down. With the current cost of goods, which we have taken down fairly dramatically, there’s no way to make money on the console in this first generation. So the key is, how do we do in the hardware design and the chip-set design and the supply-chain design with Version 2. If we do as expected, we have a good crossover point where that big negative number is no longer a negative number, and because of the size of the revenue and the size of the percentage that is negative, when you have a crossover, that’s a good contribution in terms of bottom line."