Microsoft's Windows Phone business is not a profitable one. A filing with the US Securities and Exchange Commission (SEC) shows the phone hardware division has lost money. Excluding marketing and R&D costs, Microsoft lost 12 cents per phone in the quarter ending March 31. Microsoft may have to write-off some of its Nokia acquisition as a result.

The company is reporting $1.4 billion in revenue for the quarter but it spent $4 million more. Microsoft has warned about possible declines in cash flows moving forward and a reduction in future unit volume that may warrant "an impairment adjustment" that could potentially bring a "material charge to earnings."

Lumia sales are increasing but not enough to actually make the business profitable.