The Microsoft Kin, the ill-fated mobile phone, which launched earlier in the year cost the Redmond based company $240 million Microsoft has confirmed in its latest earnings report.

"[The] cost of revenue increased $240 million or 2%, primarily reflecting increased online costs and charges resulting from the discontinuation of the KIN phone", Microsoft details.

Of course you can't just pluck $240m out of nowhere, so where did the cash come from? It seems that Microsoft used profits from its Xbox 360 division to bail it out:

"[Costs are] offset in part by decreased Xbox 360 console costs and reductions in other costs due to resource management efforts".

Add that figure to the $500 million that Microsoft paid for Danger, the software company behind the Sidekick and lead on the Kin project, and it's become a very expensive project indeed.

Luckily, the rest of Microsoft's figures were good with the company boasting its best quarter in history, thanks to strong sales of its operating system, Windows 7

The Microsoft Kin lasted just 2 months before being pulled, with Microsoft never giving an official reason for the move. Rumours however, suggest that it was down to poor sales with Microsoft supposedly only managing to sell less than 10,000 handsets in total.

Meanwhile, those handful of people that did believe enough in the Kin to actually buy one will be pleased to know that Microsoft has quietly updated its Kin phone software, reports, with minor functional changes to Twitter, although amazingly you still can't retweet.