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MS Fiscal Q3 conference call

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MS Fiscal Q3 conference call

Old 04-18-02, 04:30 PM
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MS Fiscal Q3 conference call

In case anyone's interested, you can listen in at:

http://www3.vcall.com/auto/companies...ult041802.htm#

It's set to start at 2:30 PDT, but as of now, it hasn't started.
Old 04-18-02, 05:31 PM
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whoa just listening to that for 2 minutes makes me glad I didn't major in business and statistics....

"Now when its at 14% and if the 20% increase the 30% we can go for the quarter 3 for 15% by quarter 1, thereby resulting July and September in the 3 year enterprise shift"

Um.....what he said!
Old 04-18-02, 06:20 PM
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The only interesting peice of info out of that was the lowering of sales expectations:

"Microsoft now expects to sell 3.5 million to 4 million units for its 2002 fiscal year, which ends June 30. Previous forecasts called for sales of 4.5 million to 6 million units during the period."
Old 04-18-02, 06:23 PM
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Well, the conference call is over, but they said they'd have a recording available to stream from their website for the next few days.

They declined to get into as much detail about current XBox numbers as I had hoped. Generally, they just repeated the company line that they were pleased with its sales in NA, but disappointed so far by its performance overseas.

They did revise downward their expected total world wide sales for XBox at the end of FY03 (end of this June) from the 4.5 to 6 million range to the 3.5 to 4 million range. They also stated their estimate for the end of FY04 to be in the 9 to 11 million range.

They chose to emphasize the success of the XBox games sales in NA, especially relative to Sony's performance with the PS2 over a comparable period. They mentioned that Halo had hit the 1 million units sold milepost faster than any other game for a next-gen console. Also, 20 XBox games have hit the 100K units sold mark. Tie in ratio in NA was at 4.1.

Sony only had 8 games that had sold 100K units and had a tie in ratio of under 3 in the comparable period after launch. To summarize, they XBox has sold 30% more consoles and 80% more games than PS2 had when it was at this stage of its launch.
Old 04-18-02, 07:10 PM
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Originally posted by belboz
Well, the conference call is over, but they said they'd have a recording available to stream from their website for the next few days.

They declined to get into as much detail about current XBox numbers as I had hoped. Generally, they just repeated the company line that they were pleased with its sales in NA, but disappointed so far by its performance overseas.

They did revise downward their expected total world wide sales for XBox at the end of FY03 (end of this June) from the 4.5 to 6 million range to the 3.5 to 4 million range. They also stated their estimate for the end of FY04 to be in the 9 to 11 million range.

They chose to emphasize the success of the XBox games sales in NA, especially relative to Sony's performance with the PS2 over a comparable period. They mentioned that Halo had hit the 1 million units sold milepost faster than any other game for a next-gen console. Also, 20 XBox games have hit the 100K units sold mark. Tie in ratio in NA was at 4.1.

Sony only had 8 games that had sold 100K units and had a tie in ratio of under 3 in the comparable period after launch. To summarize, they XBox has sold 30% more consoles and 80% more games than PS2 had when it was at this stage of its launch.
Too bad they are not competing with the PS2 from that period. the problem is that they are competing with the PS2 now and they are being outsold.

Frankly I am a bit disappointed. i was hoping they were going to keep the sales figures and lower the price to hit them.

I think that if they just dropped the price to $199 they would increase sales. Why wait for Sony to lead you. take the lead and drop the price first.
Old 04-18-02, 09:01 PM
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This is something that amazes me, people that assume that since MS makes a ton of money on PC software that they can their lower prices and take huge hits in the Xbox hardware.

I agree that MS will have to lose some money in selling hardware, but the assumption that MS can lower prices really low because they arn't going out of business any time soon doesn't fit.

It's true that MS is healthy and that they do have money. However, the thing to remember is that the company is responsible to stock holders. I do not think they want to piss all their money away.

Are they going to go out of business? Hell no. But if the xbox fails, I don't see them just throwing money out the window for the next five years in order to save face.

The only exception to this would be if everyone on the board agreed that they absolutley had to aquire the gaming market ASAP for their gateway devices. But I believe time is on MS's side so I doubt this.

*These comments aren't directed at anyone in particular. Really. Just thoughts I've gathered over time from reading some people's opinions.
Old 04-18-02, 10:12 PM
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I think that if they just dropped the price to $199 they would increase sales. Why wait for Sony to lead you. take the lead and drop the price first.
I'm not sure the "we'll make up for the loss we take on each unit, by cutting the price & selling more" idea will work ... let's face it Amazon already tried that (we'll make up for that loss on each book we sell with volume")
Old 04-19-02, 12:39 AM
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Originally posted by sniper308


I'm not sure the "we'll make up for the loss we take on each unit, by cutting the price & selling more" idea will work ... let's face it Amazon already tried that (we'll make up for that loss on each book we sell with volume")
No but they have two choices really. Compete or not. At the same price as the PS2 they have shown they will be outsold by the PS2. So they can continue to be outsold and fall further behind the PS2 or they can drop their price below the PS2 and try to gain market share.

I do not think they will catch the PS2 but by getting closer they will have a better chance to get or hold exclusives. With the current strategy they will continue to lose market share and exclusives.

Of course they can not just throw money away. So maybe they have decided how much they are willing to lose to gain market share and they also have decided that they can not afford to lower the price to below the PS2. Plus if the software sales income does not generate enough money they might never get the system profitable at too low of a console price point They have more market data than we do so it maybe that they are seeing a reluctance to buy the XBox at a level such that they are not willing to lower the price to the levels where that reluctance disappears.

Also they might be seeing that the loses they expected will be higher than they had originally forecast so to increase those loses is unacceptable.

Of course the one thing that may be holding them back is the antitrust trials. maybe if they lowered the price to undercut the PS2 their attorneys have decided that they will open themselves up to more unwanted attention.
Old 04-19-02, 01:00 AM
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Originally posted by belboz

They did revise downward their expected total world wide sales for XBox at the end of FY03 (end of this June) from the 4.5 to 6 million range to the 3.5 to 4 million range. They also stated their estimate for the end of FY04 to be in the 9 to 11 million range.

They chose to emphasize the success of the XBox games sales in NA, especially relative to Sony's performance with the PS2 over a comparable period. They mentioned that Halo had hit the 1 million units sold milepost faster than any other game for a next-gen console. Also, 20 XBox games have hit the 100K units sold mark. Tie in ratio in NA was at 4.1.

Sony only had 8 games that had sold 100K units and had a tie in ratio of under 3 in the comparable period after launch. To summarize, they XBox has sold 30% more consoles and 80% more games than PS2 had when it was at this stage of its launch.
30% more consoles? Well, the PS2 systems were in short supply from October through April, but there's still some funky math there. I wonder if Microsoft is including their (poor) launch sales from Japan and Europe and measuring against the North America only sales of PS2. Or measuring against only the PS2 Japanese launch.

As for the tie-in, good for them. And good for Bungie. Halo is a great game. But, of course, Metal Gear Solid 2 sold more than 5 million copies... and this June there will be 4 million XBoxes worldwide, if MS is lucky. Hmm. Yeah. They're gonna get some top tier exclusives all right.

It looks to me like, by their own prediction, their long term expectation is to sell one XBox for every four PS2 systems. That can work if you're Nintendo, and have your own stock of phenomenal exclusives, and Game Boy to back you up. It won't work if you're anyone else.
Old 04-19-02, 08:00 AM
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Originally posted by ScandalUMD


30% more consoles? Well, the PS2 systems were in short supply from October through April, but there's still some funky math there. I wonder if Microsoft is including their (poor) launch sales from Japan and Europe and measuring against the North America only sales of PS2. Or measuring against only the PS2 Japanese launch.

They are comparing against only the US sales. At least thats what I decided since Super Smash Brothers actually sold 1 million units last year in Japan, and in a much shorter time then Halo did here. (They claim to have had the fastest 1 million seller for next gen. True, if you exclude Japan. I'm fairly certain SSBM broke that a long time ago) You have to keep in mind, Spin docters at work. Everyone does it. Just have to see through it.

Last edited by jeffdsmith; 04-19-02 at 08:11 AM.

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