Microsoft Surface RT performance damages company's latest earnings

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Surface-big-top.jpgMicrosoft have revealed their fiscal Q4 2013 earnings. And while overall impressive (with the company posting fourth-quarter earnings of $4.97 billion – 59 cents a share – on revenue of $19.9 billion), it also revealed disappointing Surface RT tablet performance resulting in a write down on the tablet inventory.

As such, Surface RT caused a $900 million loss, amounting to 7 cents a share. It seems the company over-estimated demand for the RT model, leading to stock overloads, though the loss only affected revenue for Windows.

However, even with the loss, Windows division still showed a year-on-year revenue increase thanks to strengthening sales of the Windows 8 operating system and devices carrying its license.

Surface sales have increased during the first quarter of 2013, though this is likely thanks to increased availability of the Surface Pro models, which run the full version of Windows 8 and reviewed much better than the RT models.

Just this week Microsoft slashed the prices of their Surface RT machines, which now seems obviously due to static stock. The 32GB model now costs £279, down from £399, while the 64GB model now costs £359, down from £479.

Gerald Lynch