Surface (table, left angled, red cover)

Steve Ballmer sounded pretty confident when his company debuted the Surface tablet last fall. At one point, he even said “I don’t think anybody has done a product that is the product that I see customers wanting,” implying that Microsoft had.

But I think by now, it’s pretty clear that’s not the case. Not only did the software giant have to eat $900 million in unsold Surfaces last quarter, but estimates based on a new SEC filing suggest that it’s only sold 1.7 million of them since launch…

GeekWire points to Microsoft’s 10K that it just filed with the Securities and Exchange Commission, which discloses that the company only made $853 million from its Surface lineup. The filing is annual, so it dates back to the tablet’s introduction.

“The company doesn’t disclose the number of units sold, and the range of products from the Surface RT to the Surface Pro makes it difficult to derive an average selling price.

But hypothetically, if the average price were $500 (the original price of the base-level Surface RT), the revenue figure suggests that total units sold were in the range of 1.7 million units as of the end of June.”

The site’s 1.7 million approximation is in line with a report from Bloomberg back in March, which estimated that Microsoft had sold 1.5 million units up to that point. For reference, Apple sold 14 million iPads last quarter, or about 1.2M per week.

http://www.youtube.com/watch?v=wE7AQY5Xk9w

And the company knows there’s a problem. Following a major fire sale, Ballmer hosted a closed-door town hall meeting last week where he reportedly admitted they’d built “a few more” Surfaces than they could sell. He also said a new one is in the works.