Supply shortages hurt Xbox sales last month

Xbox 360 sales last month were hurt by supply shortages, a Microsoft Corp. spokesman said Wednesday, before the NPD Group's release Thursday of U.S. video-game console statistics for January.

The spokesman, David Dennis, declined to say where Microsoft expects the Xbox 360 to stack up against Sony's PlayStation 3 and Nintendo's Wii for the month.

Microsoft says the current shortages are being caused by Xbox 360 sales exceeding its forecasts during the holiday shopping season.

"We did not forecast the level of demand that we would see throughout the holidays, and we didn't manufacture as many units as we should have," Dennis said.

He explained: "It's simply a case of demand outpacing supply at this point. We're working as hard as we can to replenish supply with all of our retailers, but we are aware of supply issues across the board at most major retailers in the U.S."

The company talked about the shortages Wednesday in an effort to "manage expectations" in advance of the NPD report.

Dennis said the shortages aren't caused by the expanded Xbox 360 warranty and replacement program. That program was announced last year to address what the company described as "unacceptable" hardware failure rates.

The Xbox 360 has been No. 2 behind the lower-priced Wii in U.S. unit sales in most months since the new Nintendo and Sony consoles were released, according to NPD data. The PS3 has been a consistent third.