Microsoft's Product Slide Continues

Microsoft launched the Surface table in October of 2012 and it has been an uphill battle ever since. The company managed to almost spend $1bn in advertising expenses to promote Windows 8 and the Surface. This is amazing if you consider that they only generated $853m in Surface revenue for all of fiscal 2013.
In reviewing Microsoft's 10k, I found some interesting notes.

From Microsoft's 10k

We will continue to invest in new software and hardware products, services, and technologies, such as the Microsoft-designed and manufactured Surface launched in October 2012. Investments in new technology are speculative. Commercial success depends on many factors, including innovativeness, developer support, and effective distribution and marketing. If customers do not perceive our latest offerings as providing significant new functionality or other value, they may reduce their purchases of new software products or upgrades, unfavorably impacting revenue. We may not achieve significant revenue from new product, service, and distribution channel investments for a number of years, if at all. Moreover, new products and services may not be profitable, and even if they are profitable, operating margins for some new products and businesses will not be as high as the margins we have experienced historically.

And this sums it up. Launching new products to remain competitive in the consumer market can be costly, especially if you describe your approach as speculative.