Microsoft has ramped up shipments of its Xbox 360 console to widen its head start on video game rival Sony's PlayStation 3, the software giant's chief financial officer said on Thursday. The world's largest software maker raised the bottom line of its Xbox 360 sales target range for the year ending June 30 to 5 million to 5.5 million units from an earlier range of 4.5 million to 5.5 million.

Increased Xbox 360 production eased some of its supply constraints, but it also lifted manufacturing costs and hurt Microsoft's profit margins, Chief Financial Officer Chris Liddell said in an interview.

"We made a conscious decision to be very aggressive on selling Xbox 360 consoles to get as much into the installed base as we possibly could ahead of Sony's launch," Liddell said. "We're very happy with the market momentum, but from an earnings point of view, it's hurting us."

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