Microsoft had set a target of two million Surface RT tablet sales, saying investors had received the tablets positively, prompting its increased production.
Thill, in an investors note, attributed the below forecast sales figures to competition from the iPad as well as narrow distribution.
"Surface RT is a consumer device with [fourth-quarter] sales suffering from the difficult iPad compare and narrow distribution,” he said. Microsoft had concentrated its tablets on its own stores and only added it to other stores in mid-December.
The performance was, however, higher than Thill’s previous prediction that the tablet would sell just 600,000 units.
The analyst does, however, have higher expectations for the Windows 8 Surface Pro tablet when it launches later this month, referring to it as “more promising” and a genuine alternative to the iPad. He projected sales of 2.5 million units in 2013 and as high as 8 million in 2014.