Microsoft's division in charge of the Surface hardware has doubled its revenue over the last year, with the team reporting revenue of $908 million for the quarter which ended on Sept. 30.
Ben Kepes takes a look at Microsoft's Q3 numbers in more detail here on Forbes, but I want to zero in on the numbers around the Microsoft Surface, and specifically the Surface Pro 3.
The third generation of Microsoft's reference design for a tablet (or a laptop) that thinks it is a laptop (or a tablet) went on sale during the last quarter, and generated $908 million in revenue. That's more than double the same quarter for the previous year, which saw the division post revenue of $400 million. There are no figures on the actual income generated but gross margins were reported as positive, so the Surface is earning money. We just don't know how much.
According to legend, Microsoft takes three revisions to sort out a product. The Surface range does fit into that pattern if you count the original Surface RT and Surface Pro devices as generation one, the Surface 2 and Surface Pro 2 as generation two, and the current Surface Pro 3 as generation three. More importantly, the Surface Pro 3 moves away from the ten-inch 16:9 form factor that typifies a tablet and was built with a twelve-inch screen in a 3:2 ratio. That change makes the Surface Pro 3 feel much more business-like and suited to being an ultraportable laptop, as opposed to a very powerful tablet.
That change has a positive effect on the perception of the Surface tablet. It feels like a business machine in this third iteration, and this will have driven more interest to the Surface hardware. Microsoft must be expecting a billion-dollar holiday quarter for the Surface division, and for sales to continue growing in the New Year. This will be helped by a commitment from Microsoft to long-term support for the Surface Pro 3 for enterprise and business customers.
