Microsoft expects to make a profit with Xbox One launch

Microsoft is expecting a rather unconventional thing: that it will break even, or even make a profit, with the launch sales of the Xbox One. Precedent goes against the company, since the neither the original Xbox nor the Xbox 360 could even break even at launch.

According to GamesIndustry , Xbox’s Yusuf Mehdi said during the Citi Global Technology Conference that “we’re looking to break even or low margin at worst” with the new console. Historically gaming companies have generally sold their consoles at losses, and recovered the price and made profits thanks to the licensing of games for their consoles.

“This will make us money”

Mehdi believes that cost-reducing will help further down the line. “As we can cost-reduce our box as we’ve done with 360, we’ll continue to price reduce and get even more competitive with our offering,” he said. “You’ve seen us over the years constantly be focused on profitability and improving year over year. If you look at 360 that platform lasted for seven to eight years and it’s going to go for another three years. It’s incredibly profitable now in the tail.”

Earlier, Mehdi had revealed that the Xbox One’s CPU is getting a 150 MHz boost in clock speed. This pushes the console’s clock speed up from 1.6 GHz to 1.75 GHz. Mehdi has also revealed that manufacturing for the Xbox One is in full swing now as the November launch window gets closer. The official launch date for the console will be revealed later.

The Xbox One is hitting stores in the first batch of markets in November. The rest of the world will get the console only next year.