Microsoft’s Surface Tablet Revenues Are Less Than it Spent on Advertising

Blue Microsoft Surface

As if anyone needed further proof that the Surface has flopped, Microsoft’s annual Form 10-K filing with the Securities and Exchange Commission reveals that the company’s revenue from the tablet lineup was a paltry $853 million.

That number reflects an eight month period from when Microsoft launched the Surface tablet last October to the end of the fiscal year on June 30. The revenue accounts for sales of both the Surface RT and Surface Pro, although total units sold were not disclosed. 

To put that $853 million into perspective, it is less than the $900 million charge that Microsoft suffered for discounting the price of its Surface tablets. The company most recently slashed $150 off several of the tablet models in an effort to clear unsold inventory.

Even worse, Microsoft noted in its filing that it saw an increase of $1 billion in expenses related to Windows sales and marketing, “reflecting an $898 million increase in advertising costs associated primarily with Windows 8 and Surface.”¬†That means Microsoft has spent more money to advertise the Surface than it has made revenue on the tablet.

The fate of Windows RT as a whole appears dismal, as several third-party manufacturers have either discontinued or cancelled their plans to release products based on the platform. Asus recently confirmed that it has no plans to release any more Windows RT products, and Acer appears headed down that road too.

[GeekWire]

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