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Microsoft denies cutting Xbox One shipments due to production issues

Microsoft has reportedly cut the number of Xbox One game consoles it expects to ship in 2013 from seven million units to 6.2 million units due to some supposed issues with component yield rates, but the software giant called the rumor "incorrect."

The report appeared this week in the Chinese-language Economic Daily News and was passed along by DigiTimes, which noted that issues with the next-generation console's "camera module, optical disc drive, and related assembly" are purportedly holding up production of the Xbox One.

DigiTimes added that suppliers expected to be affected by the rumoured lowering of Xbox One orders from Microsoft include Global Unichip, Nuvoton Technology, and Newmax.

Microsoft categorically denied that this was the case.

"That report is incorrect. We have not lowered shipping volumes, and are actually seeing better than expected yields from our silicon," Albert Penello, a Microsoft senior director of product management and planning, said in a statement.

"We just returned from Gamescom where we showed the overwhelming majority of content on Xbox One near-final hardware. We also just rolled out a widespread employee beta and remain on track for a November launch this year," Penello added.

Meanwhile, Sterne Agee analyst Arvind Bhatia said that even if the rumour was true, it wouldn't matter much in the short term. The analyst said Microsoft is only expected to sell approximately three million Xbox Ones this year, so having fewer than seven million units assembled and ready to ship will be a "non-issue."

"If Microsoft can ship 6.2 million units of Xbox One, as reports indicate, it would still be significantly above current estimates," Bhatia said in a research note.

Sterne Agee is also tipping the plausibility of rumours that the Xbox One will be released at the start of the second week of November, putting the follow-up to the Xbox 360 on retail shelves at around the same time Sony plans to release its own next-gen game console, the PlayStation 4.

"There is speculation that Microsoft will release Xbox One in North America on Nov. 8 or one week before the launch of Sony's PS4. This has not been confirmed but seems in line with general expectations of a November release," Bhatia said.

Microsoft has been prepping the market ahead of the arrival of its next big game console, recently releasing a list of 23 Xbox One launch titles, while also reversing course on some much-criticised initial platform requirements for the system — such as dropping requirements that the Xbox One have an Internet connection and be hooked up to the Kinect sensor to work properly.