Microsoft wrote down $900 million worth of Surface RT inventory

Microsoft has not had an easy time convincing users to buy into Windows RT, and has the Surface RT inventory to prove it.

The company recently put its ARM-based Surface tablet on firesale, discounting it by 30% across the board. This was seen as a desperate move to clear some stock before the release of a new version later this year, but things were clearly worse than expected. The company just issued a $900 million charge for Surface RT inventory, citing slowdown in the PC market.

Whereas the Surface Pro, which runs an Intel Core i5 chip, is twice the price at minimum, it appears to be selling quite well. But the Surface RT, which is limited to loading apps from the underpopulated Windows Store, is relatively slow, clunky and overall inferior in comparison. Going up against the iPad, Microsoft had no shot at all.

Microsoft posted fiscal Q4 revenues of $19.9 billion on earnings of $0.59 a share, which was significantly below analysts’ expectations. While the Windows division is doing quite well, relatively speaking, and the Xbox 360 has continued to sell like hotcakes leading up to the release of Xbox One later this year, the company cannot find its feet in the devices division.

Microsoft has promised an improved range of Windows 8 Store apps such as Flipboard for later this year, but developers have not been impressed by the store’s terrible discovery features and lacklustre sales numbers. Indeed, only yesterday Vector Unit, the team behind popular game Riptide GP, said that Windows 8 sales have been awful and don’t intend on releasing another game for the platform until there is a clear indication that the tides have turned.

It doesn’t look like that’s going to happen anytime soon.

Via: TheNextWeb