Xbox Sells at a Loss for Microsoft

The Xbox 360 video game console from Microsoft (MSFT) may be hot but it's not profitable. According to iSuppli (BusinessWeek, December 5, 2005) the materials (chips, hard drive, power supply, controller and cables) in the Xbox cost $470 before assembly. At a suggested retail price around of $399, Microsoft stands to lose about $71 per unit.

It's good for Microsoft that they have Windows and related software to fund their many money-losing ventures.