Analysts: Halo 3 to push Xbox business into the black


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Analysts: Halo 3 to push Xbox business into the black

Goldman-Sachs expects first-week sales of Bungie's shooter to reach about $170 million, giving Microsoft's gaming division its first profitable quarter.

There's no question that Halo 3 is going to be big. Several weeks ago, a rumor surfaced that GameStop had already collected an outlandish 4 million preorders for the game. Today, a quartet of Goldman-Sachs analysts released their own projections for the game's September 25 launch, with numbers nearly as gaudy.

While Halo 3 is releasing right at the end of Microsoft's first fiscal 2008 quarter (which runs from July through September), Goldman-Sach's industry watchers are expecting the game to contribute about $170 million in revenue for the quarter, with more than 4.2 million copies shipped into the retail channel. That's nearly one copy for every three Xbox 360s in the world, going by the analysts' projections of an installed user base of 13.2 million by September.

They also note that the $170 million figure could be low by as much as $50 million if they've lowballed the installed user base. Microsoft's tendency to put revenue from games on its books as soon as they're shipped out could also boost the revenue number, as could any change to the analysts' royalty model, which assumes Microsoft keeps 80 percent of the retail price on first-party games.

For comparison, Halo 2's November 2004 launch came in the middle of Microsoft's financial quarter, when the original Xbox installed user base was 19.9 million. Microsoft sold 7.5 million copies by the end of the quarter (38 percent of the user base), with 2.38 million sold on day one, according to the analysts.

Perhaps more significant than the sales figures that Goldman-Sachs expects Halo 3 to put up is the analysts' expectation that by the end of its first week of release, the game will have driven Microsoft's Xbox division to its first profitable quarter ever. Microsoft has been touting its fiscal 2008 as the turning point in the entertainment and devices division for some time, as Robbie Bach first made mention of the profitability goal in July of 2006.

By Brendan Sinclair -- GameSpot

Posted May 24, 2007 2:14 pm CT

Story from GameSpot: http://www.gamespot.com/news/6171483.html

Copyright ?2007 CNET Networks, Inc. All Rights Reserved.

And that's just Halo3, Other games will sell and push the system also. It's true that they won't get alot from 3rd party games like they do from their own 1st party titles. But solid sales like GoW did help either way you look at it.

the X360 so far has the best lineup of games coming this fall by far:

halo 3

bioshock

gta

mass effect

i know there are more too but with all these AAA titles on the verge for one xmas season...its going to be an expenisve year for the x360'ers

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