Microsoft CEO Steve Ballmer has admitted that they built too many Surface RT tablets and that they are not selling as many Windows devices as they would like. The company held an internal town hall event last week.

They discussed the $900 million hit for Surface RT tablets and the somewhat sluggish sales pace for Windows. Sources say that Ballmer talked openly about Microsoft's focus on securing instagram for Windows Phone and their plans for the next generation Surface. Neowin first reported on several areas of the meeting.

Ballmer said “We built a few more devices than we could sell” when asked about the Surface RT sales. The company have recently cut the price of the Surface RT by 30 percent worldwide, in the hopes to drive forward more sales to people who just couldn't afford the tablet when it was first released.

Rumour has it that Microsoft are testing the new Surface devices with the Qualcomm Snagdragon 800 processor.

Windows is also a sore point. Ballmer admitted “We're not selling as many Windows devices as we want to”, incorporating PC's, tablets and phones. Microsoft are pushing hard going forward and recently paired up with Best Buy to open special Windows stores in over 500 locations.

Kitguru says: A tough 12 months for Microsoft as they face tough competition from the likes of Samsung and Apple.

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