Microsoft only earned $853 million in Surface revenue - despite $898 million advertising increase
Microsoft filed on its annual Form 10-K with the Securities and Exchange Commission on Tuesday, disclosing that it earned only $853 million in revenue on Surface from the time the tablet series launched in October through to the end of the company's fiscal year in June.
Microsoft's latest quarterly earnings, which ended 30 June and released in July, had originally let slip that the company suffered a $900 million write-down for Surface RT, forcing CEO Steve Ballmer to admit that it built too many tablets and didn't sell as many Windows devices as hoped.
With today's news, it's now obvious that Surface revenue is less than Microsoft's write-down for Surface RT. If you think that's bad, GeekWire first noted that Surface revenue is less than the "$898 million increase in advertising costs associated primarily with Windows 8 and Surface".
Microsoft neglected to detail exact sales numbers for Surface, but The Verge did the maths - and cited a past Bloomberg report - to come up with 1.5 million units sold for Surface RT and 400,000 units sold for Surface Pro. Business Insider then compared Microsoft's $853 million in Surface sales to Apple's $25 billion in iPad sales for the same eight-month period.
It's also worth repeating that Microsoft slashed the price of its Surface RT tablet in multiple stores around the globe roughly two weeks ago. When it launched in the UK last year, Surface RT cost £399. You can now pick one up for just £279 - a saving of over 33 per cent. That said, Microsoft will likely refresh both its Surface RT and Pro tablets in late 2013.