Microsoft Surface Continues To Bleed Red Ink

While the blogosphere and Wall Street continue to obsess about Apple’s catastrophically being only able to sell (profitably) 13.3 million iPads in calendar Q2, 2014, Microsoft’s Surface tablet business has lost money each quarter, and each fiscal year since its introduction in 2012.

Computerworld’s Gregg Keizer reports that in its just-concluded 2014 fiscal year, hundreds of millions of dollars more in red ink increased MIcrosoft’s cumulative Surface losses to $1.7 billion in less than two years. Computerworld estimates a loss of approximately $363 million in Q2/14, the largest one-quarter loss for the Surface since Microsoft began providing quarterly revenue numbers.

Keizer cites Jan Dawson, chief analyst at Jackdaw Research, who estimated the June quarter’s cost of revenue at a slightly different $733 million, for a loss of $324 million, musing “if the Surface is one, not growing sales; two, losing money; and three, not creating a market, what’s the point ultimately?”

It’s log past being obvious that whatever the successful formula might be for dislodging iPad’s hegemony in the premium tablet category, the Surface isn’t it.

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