Look at page 6 of this financial report:
http://files.shareholder.com/downloads/ERTS/691140953x0x292575/ab168313-7e7c-4738-a2bc-045cc3074d16/EAQ409Supplemental5509FINAL.pdf
Their gross profit (revenue minus cost of goods sold) was around $2 billion in the last fiscal year.
Their expenses are:
R&D - $1.36 billion
Marketing and sales - $691 million
Those two alone already equal their gross profit. Then there other expenses like Administrative ($332 million) etc.
If we go back to a profitable fiscal year (2007) it looked like this:
Gross profit - $1.88 billion
Expenses:
R&D - $1.04 billion
Marketing and sales - $466 million
(this time, add the two and you're not year near the gross profit)
As you can see, their R&D and marketing expenses are increasing faster than gross profit (i.e. game sales), even if gross profit is increasing.
Basically they're spending a lot more money on game development and marketing than before... I blame the high cost of PS360 development for the former, the latter I don't know... More competition maybe?
My Mario Kart Wii friend code: 2707-1866-0957
