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There’s been quite a bit of interesting financial commentary on Microsoft’s Surface line of tablet-hybrids published recently. The Surface project loses money prompting many to wonder is the Surface the new Zune, a product line that improved throughout its life, but never achieved escape velocity? ComputerWorld did solid work digging into Microsoft’s earnings reports to suss out how much money the company has lost on Surface by comparing revenue statements with cost of revenue numbers when possible, and estimates of cost of revenue when not. The gist is not pretty: “Microsoft has lost $1.73 billion ($676 million plus $1.049 billion) on the new hardware.” It could actually be worse than that, as ‘cost of revenue’ calculations don’t include certain expenses like advertising, something that Microsoft has spent heavily on for the Surface line.



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