The Xbox came out when the PS2 did. When it came time for the next generation, Sony went with the obvious PS3. Microsoft of course couldn't compete with an "Xbox 2" vs a "PS3", and they couldn't skip right to "Xbox 3", so they called it the "Xbox 360", which was frankly genius because it had the 3 there anyway and put it on the same level in consumers' eyes.
But after that it all fell apart -- they had no good options. They still couldn't jump to "Xbox 4". Maybe "720" would have worked. Someone decided to have a clean break and restart at "One" but of course that fell apart immediately at "Two". So another clean break to "Series..". And by that point it's so screwy they've lost any chance of fixing it...