For the First Time Ever, Xbox Turns a Profit for Microsoft

Ladies and gents, this is an important moment in video game history. Over the last six years, not once has Microsoft turned a profit with its Xbox or Xbox 360 platforms. However, things are looking up for the industry newcomer. According to the company’s second-quarter earnings, its Entertainment and Devices Division (the division responsible for all things Xbox) generated $524 million in income. That’s pretty impressive compared to the same period one year ago, in which Microsoft ‘s gaming division reported a $432 million loss.

According to Microsoft, this increase in revenue is “primarily due to increased Xbox 360 platform sales.” Console and PC game revenue increased 35%, thanks to “increased Xbox 360 console sales, video game sales led by Halo 3, Xbox Live revenues, and Xbox 360 accessory sales.” In addition to increased sales, the decrease in Xbox 360 manufacturing costs no doubt helped Microsoft. Also, the company saw a decrease in the cost of marketing and promoting Xbox 360.

Microsoft says it expects revenues in the rest of fiscal 2008 to “increase due to increased sales of Xbox 360 consoles and related games, accessories, and services.”