Microsoft took one on the chin last week when the company announced they had lost $900 million on the Surface RT.
With quarterly revenue of $19.90 billion and diluted earnings per share at $0.59, Microsoft said in a release that the “financial results include a $900 million charge, or a $0.07 per share impact, related to Surface RT inventory adjustments.”
In other words, the company hasn’t sold as many as it had hoped.
Just days before, Microsoft shaved $150 off the original price. As a result, the 32GB version costs $349, while the 64GB model is now $499, the original price of the 32GB version.
“What is surprising, however, is that the company so grossly overestimated demand for the product that it apparently had its manufacturers build many millions, such that it would then have to write down the value of millions of units of unsold Surface RT stock,” wrote Ars Technica’s Peter Bright. “That’s a spectacular misjudgment.”
The technology giant has recently launched a new ad campaign for the product focusing on features it has that the iPad lacks, such as SD cards, a kickstand, simultaneous multitasking, and of course, a much lower starting price.
To see the new ads, check them out on the Surface YouTube channel.
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