Microsoft Surface Estimated to Have Sold Only 1.7 Million Units Since Launch

MacRumors · Jul 30, 2013

Microsoft filed its annual Form 10-K with the Securities and Exchange Commission (SEC) today, revealing that the Microsoft Surface lineup has garnered only $853 million in revenue for the company, which is less than the recent $900 million writedown the company took for the Surface RT.

And as GeekWire notes, it's also less than the "$898 million increase in advertising costs associated primarily with Windows 8 and Surface." The numbers account for all Surfaces sold from the device's original fall launch until the end of Microsoft's fiscal year on June 30.

While Microsoft did not reveal how many Surface units it sold, GeekWire does estimate that it sold approximately 1.7 million units by the end of June, which roughly corroborates a Bloomberg report in March claiming that Microsoft had sold 1.5 million Surface devices.

As The Loop's Jim Dalrymple points out, Microsoft has sold 1.7 million Surface units in 8 months, which is a far cry from the 3 million iPads Apple sold in 3 days last November, the 14.6 million iPads it sold last quarter and the 57 million iPads Apple sold since the Surface launched.

Late last week, Microsoft CEO Steve Ballmer told employees at an internal Microsoft town hall meeting that the company had "built more devices than [Microsoft] could sell" in reference to slowing Surface sales. Recently, Microsoft has been trying to sell more devices by aggressively marketing the Surface RT as an iPad competitor with negative ads and was forced to drop the price of its Surface RT prices by $150.

Despite the slow sales of the Surface tablets, Microsoft is said to be pushing forward with plans for a second generation tablet.

Article Link: Microsoft Surface Estimated to Have Sold Only 1.7 Million Units Since Launch

MultiMediaWill · Jul 30, 2013

That's what happens when you release a s*** product.

A Hebrew · Jul 30, 2013

With the current price the only thing holding the Surface back is the OS. Once Windows 9 comes out and fixes the necessary flaws in Windows 8 it will be a stellar tablet.

BvizioN · Jul 30, 2013

That's not to shabby MS

Now only if you do not COMPARE that with the iPad sales.

AppleScruff1 · Jul 30, 2013

MultiMediaWill said:
That's what happens when you release a s*** product.

Except it really isn't a #$%& product.

coolspot18 · Jul 30, 2013

MultiMediaWill said:
That's what happens when you release a s*** product.

Microsoft Surface is actually a pretty good product ... better than Android or even iOS in some respects.

I think the failure has more to do with marketing - the confusion between RT and Pro. Also, forcing consumers to use Windows 8 on the desktop did help to engender good will. Lack of developer support didn't help. Partnering with Nokia (a dying phone company) to produce a line of bum phones didn't help Microsoft's image either.

bondsbw · Jul 30, 2013

Android phone sales were lackluster in their first year against the iPhone. Android tablet sales were lackluster in their first year against the iPad.

Both are doing just fine today... you can't judge long term viability in an established market by how well a company competes in the first year.

anzio · Jul 30, 2013

That's 1.7 million more than I expected. So I guess I'm reading this as good news for Microsoft!

PhamQu · Jul 30, 2013

Well, they are determined, I've got to give them that.

mrsir2009 · Jul 30, 2013

A Hebrew said:
With the current price the only thing holding the Surface back is the OS. Once Windows 9 comes out and fixes the necessary flaws in Windows 8 it will be a stellar tablet.

The problem though is that Microsoft was late to the party with tablets - and with a low marketshare as a result of this they won't have many developers making apps for them. With no apps, few will buy the tablet. With few buying it, it will have a low marketshare... and so the paradox continues.

coolfactor · Jul 30, 2013

People are saying the Surface is a good product, but it's still Windows!

----------

mrsir2009 said:
The problem though is that Microsoft was late to the party with tablets - and with a low marketshare as a result of this they won't have many developers making apps for them. With no apps, few will buy the tablet. With few buying it, it will have a low marketshare... and so the paradox continues.

It wasn't just being late to the tablet market... Apple had groomed consumers with the iPod for years before the iPhone, and then along comes the iPad and it was a natural extension and expectation. Microsoft never had that luxury/smarts.

skinbubble · Jul 30, 2013

$150

Drop the price of the Surface Pro to $150 and I will consider purchasing one.

minifridge1138 · Jul 30, 2013

When the Surface RT was released I was curious, so I went to a Microsoft Store to play with one.

I had tried Windows 8 on a desktop and was unimpressed.
Using windows 8 on a touch screen definitely felt more natural.

But I still felt it was a B- product (8/10ths of a good product):
The cover/keyboard was unpredictable: some keys worked with a slight touch and others had to be pressed hard.
The hardware is underpowered: I used IE to browse CNN and IMDB. In both cases, the page would render part way, I'd try to touch a link, then the page would finish loading. BUT it knew I had clicked on the screen and would register the click AFTER the page had loaded. Which would be a little annoying, except that after the page loaded a completely different element was in the location that I touched (the link that had been there when I touched had moved somewhere else) and it redirected me to whatever random link occupied the coordinates I had touched. Lesson: wait for the page to load before trying to use the web.

I haven't played with a Surface Pro, but I'd imagine it doesn't suffer from the second problem (which in theory could be fixed with a software update).

YMMV.

Klae17 · Jul 30, 2013

Siri: 14.6 Million in Q3 of 2013.

Surface: I'm sorry I can't do that.

iSamurai · Jul 30, 2013

coolspot18 said:
Microsoft Surface is actually a pretty good product ... better than Android or even iOS in some respects.

I think the failure has more to do with marketing - the confusion between RT and Pro. Also, forcing consumers to use Windows 8 on the desktop did help to engender good will. Lack of developer support didn't help. Partnering with Nokia (a dying phone company) to produce a line of bum phones didn't help Microsoft's image either.

also their pricing too.

besides that they're marketing this as some sort of office tablet. all I could remember from their ads was people dancing on tables doing spreadsheets. if I wanted to do that I'd go do it on a computer.

throAU · Jul 30, 2013

AppleScruff1 said:
Except it really isn't a #$%& product.

Given the available alternatives and my evaluation of about 7 different Windows tablets: Yes it is. And the market agrees.

KPOM · Jul 30, 2013

bondsbw said:
Android phone sales were lackluster in their first year against the iPhone. Android tablet sales were lackluster in their first year against the iPad.

Both are doing just fine today... you can't judge long term viability in an established market by how well a company competes in the first year.

Except that there was really no viable alternative when Android entered the market.

Windows tablets may well take off, but I don't think it will be driven by RT sales. Instead once the intel-powered devices can last just as long as ARM-powered devices it could get interesting.

splashman · Jul 30, 2013

Ballmer the Clueless

Despite the slow sales of the Surface tablets, Microsoft is said to be pushing forward with plans for a second generation tablet.

Double-down on stupid.

Ballmer has absolutely no idea why the 1st-gen Surface isn't selling, so making a 2nd-gen is just plain stupid. It's a dart thrown at a dartboard by a blindfolded drunk -- he'll be lucky to hit the wall, let alone the board.

Not that I'm complaining. As long as Ballmer is CEO, that's one less competitor for Apple.

Ichabod. · Jul 30, 2013

Phew, that must hurt.

I wonder if their stock price will take another hit with this report.

Firelock · Jul 30, 2013

I've played around with a Surface and agree that it is not bad, and certainly better than the Android tablets I have used. However, neither is their anything compelling enough about it to make me think of getting one for myself. The real problem isn't marketing or "confusion about OS," it is that it is new OS (for the tablet space) that is late to the game with no software developer base. Why would I want to wait for someone to port or develop the apps for the Surface that I can have today with the iPad, or even Android? Basically too little, too late.

And I should note that MS is literally giving Surface tablets away by the hundreds and thousands to corporations. There are several people at my company who have them but they were gifts from MS. I spoke to one major developer who said they had to start developing a version of their software for Surface after MS gave one of their clients 300 tablets.

JayCee842 · Jul 30, 2013

lol

I never even considered looking at one in person after reading all the reviews when it came out. I wonder if the lack of sales continues, would it bring the price down even more?

Patriot24 · Jul 30, 2013

Cars outselling trucks, indeed.

Methinks that the name "Windows" has a lot to do with Surface's failure to appeal to today's market. There is a stigma attached to that name that they will not shake, at least not in the tablet space. Despite what Microsoft may think, consumers have clearly voted with their wallets that they do not want Windows or physical keyboards on their tablets. Time to rebrand and refocus.

Diode · Jul 30, 2013

Steve nailed it again:

"When sales guys run the company, the product guys don't matter so much, and a lot of them turn off. It happened at Apple ... and happened when Ballmer took over Microsoft ... I don't think anything will change at Microsoft as long as Ballmer is running it."

IconicM · Jul 30, 2013

I was thinking..."Yes!!! Now we'll finally get Office for iPad" then I read the last line.

MS would surely sell millions of copies of office if they ever woke up.

mrsir2009 · Jul 30, 2013

splashman said:
Not that I'm complaining. As long as Ballmer is CEO, that's one less competitor for Apple.

...which isn't really good for anybody except Apple's staff and shareholders. Competition is what makes companies give it their best, not monopolies.

Microsoft Surface Estimated to Have Sold Only 1.7 Million Units Since Launch

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