The software maker said Wednesday it was pleased with response to the device, which debuted at No. 2 in research firm NPD's weekly sales ranks, but fell to No. 5 last week.
"We're forecasting just over 1 million units for the fiscal year," said Jason Reindorp, marketing director for Zune at Microsoft. "We feel pretty good about that number."
The Zune went on sale in mid-November. In its first days, it ranked near the top of Amazon.com's electronics sales chart. According to NPD's recent ratings, though, it now holds about a 2 percent market share.
Reindorp said sales have been going "pretty well" and are "pretty much on track" with the company's initial forecast. "Microsoft has a very realistic view of the landscape," he said. "There wasn't any foolish thought of coming in and turning the whole market around."