Tomahawk, WI 01/28/2014 (BasicsMedia) – Microsoft Corporation (NASDAQ:MSFT) reported its quarterly gain last week which surpassed analysts’ expectations. The world’s largest software company saw a strong holiday season sale of its new gaming console for Xbox One and Surface tablets. The company’s larger than estimated profit report accounts for this large sale in its software and service businesses as also on the lower tax bill that the company had to pay.

Microsoft’s Xbox and Surface tablet

Microsoft Corporation (NASDAQ:MSFT’s new and faster Xbox One game console which the company had launched in November last year, contributed to account for more than half of the total sales in the last quarter. In all, Microsoft sold 7.4 million units which are a clear 1.5 million units more than what they recorded last year. Despite this, Sony Corporation (ADR) (NYSE:SNE)’s PlayStation 4 won the latest video game shutdown. The PS4 was cheaper compared to Xbox One.

As far as the second generation Surface tablet is concerned, sales jumped to $893 million during the peak holiday shopping quarter. This is more than double that of the last fiscal year. In spite of selling such huge numbers of tablets, the technology company is running at a loss in this section. Microsoft incurs a cost of about $932 million in the manufacturing and distribution of the product, which calculates up to a vast difference of $39 million in manufacturing and selling prices of the tab. It can hence be safely said that they sold no more than 2 million units of the surface tablet if it is available in the market within a price range between $450 and $1,800. In contrast, Apple Inc. (NASDAQ:AAPL) is expected to announce selling about 20 million units sales of its iPads for the holiday quarter somewhere in the next week.

Struggle in mobile computing

The 39 year old company, co-founded by Bill Gates, operates with personal computers as its key line of business. Microsoft’s Windows and Office products are still the top competence when business computers are considered, but the company loses market when it comes to mobile business. During the last ten years, with Microsoft under Ballmer, the company has lost customers to Apple Inc. (NASDAQ:AAPL) and Google Inc. (NASDAQ:GOOG) in mobile computing.

Nokia acquisition

Microsoft remained silent about Windows Phones which strengthens the company’s efforts of making a mark in the mobile world. It can be expected that it becomes stronger in the next few weeks, after acquiring Nokia Corporation (ADR) (NYSE:NOK)’s handset business. It will be Microsoft’s biggest acquisition of $7.2 billion. The company said that their total phone revenues increased by about 50% to more than about $1 billion in the quarter. This includes license fee from Nokia as well as other royalty payments it acquires from other handset manufacturers which use Google Inc (NASDAQ:GOOG)’s Android system. Analysts however see the increase in figures as a weak start for Windows which it saw in the last year quarter against the surging sales of Android smartphones.

On Jan 24, Microsoft Corporation (NASDAQ:MSFT announced the total unit sales of its Lumia smartphones to be around 8.2 million. This count was double in the same quarter previous year. Nokia Lumia lost momentum in the important holiday season which is clear when we see the 0.6 million excess units that it had sold in the previous quarter.

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