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Xbox 360 shipments fail to reach target

In a conference call to talk about hardware problems, Microsoft also notes that it failed to hit its goal of selling 12 million units by the end of June.

Microsoft acknowledged on Thursday that, in addition to experiencing an of hardware failures with the Xbox 360, the game console has also failed to reach its sales target.

The company had said it would sell 12 million of the consoles by June 30. Instead, it has shipped a total of 11.6 million units, Chief Financial Officer Chris Liddell said on a conference call

"That is slightly shy" of its projections, Liddell said, but added "we're happy with that number."

Earlier Thursday, Microsoft said it was extending the warranty on the console to three years for certain hardware failures, a move that is prompting a $1 billion charge.