Microsoft Corp. is in unenviable position in the tablet space. The more units of its Surface tablet that the company sells, the deeper in the hole it gets
The latest report filed by Microsoft to the United States Securities and Exchange Commission indicate that Redmond posted a $45 million loss attributed to Surface sales in the first quarter of 2014.
Microsoft reported $494 million in revenue from Surface for the period, (down 45 per cent from the previous quarter but up 50 per cent from the same quarter in 2013). However, Microsoft also said the total cost of manufacturing and delivery of the Surface for the quarter that ended March 31 totalled $539 million.
That leaves Microsoft $45 million in the hole for the first three months of 2014.
The Surface tablet line was introduced in 2012, and Microsoft issued a refresh to the flagship device running its Windows 8 operating system in the following year.
The Surface accounted for about $1.8 billion in revenues in the last nine months. Costs attributed to the device, however, amounted to $2.1 million.
The online technology publication Computerworld.com said that in January, Microsoft credited the loss to a “higher number of units sold.” This shows that the company continues to lose money even as it sells more Surface units.