CRN's sister publication Channelweb reported the software giant's profit had fallen by 32 percent to US$2.98 billion, when compared to the previous year.
Microsoft said its Client, Microsoft Business Division, and Server & Tools divisions had been particularly badly affected by the global drop in PC sales, but added that revenue from enterprise customers had remained stable during the quarter.
It saw client sales fall to US$3.4 billion from US$4 billion a year ago, while the Microsoft Business Division suffered a drop in revenue to US$4.5 billion from US$4.7 billion a year ago.
In a webcast announcing the results, Microsoft senior vice president and chief financial officer, Chris Liddell, said that emerging markets had been impacted in particular and demand had decreased by as much as 20 percent.
Local Microsoft resellers blamed a number of factors contributing to the slide in sales.
Cameron Kneebone, sales manager at Masterlink Computers, said the announcement made him think about the reasons for the drop in sales.
"The obvious thought was the drop is caused by public perception and slow sales of the Vista operating system, as up to half of Microsoft revenue is made by operating systems," he said.
"Personally I think it is a combination of the continuing Vista perception issues and also the "Global Economic Crises" that is not helping sales of new computers and software.
"Companies and private individuals are making do with their current computers due to an unwillingness to change their operating system to Vista and also seeing the doom and gloom on the nightly news they are less inclined to spend."
Kneebone said as a reseller this hasn't affected it in an obvious way.
"Perhaps in a small way but service work has picked up as people keep their machines for longer so the end result is the same," he said.
Chris Protheroe, owner of Conrad and Black IT services, also believed anti-Vista sentiment and with Windows 7 due out shortly, has given people more reason to delay purchases.
"The recession certainly must be taking its toll with less people purchasing new machines and more trying to make do with what they've got," he said.
"Couple this with the imminent release of Windows 7 and again, clients have good reason to delay purchases of new PC's, etc.
"The resultant drop in sales for MS (and many others) is hardly surprising."
However, Protheroe believes this bodes fairly well for sales in a year or so when Windows 7 is out and the economy is (potentially) improving.
"MS will have a field day telling us how wonderful 7 is and that it's making record sales."
He said his business is being affected to an extent by the wider economic issues.
"However as I am still able to supply both desktops and notebooks running Windows XP, the poor perception of Vista doesn't affect me at all - in fact as some larger retailers and resellers aren't offering XP any longer this puts me at a slight advantage I believe," said Protheroe.
Tomas Bates, former Microsoft reseller, said a downturn in sales can mean different things.
"Windows counts a sale of its operating system every time someone purchases a new computer, although the consumer has little to no choice in the matter," he said.
"Regardless I'm not quite sure if the performance of Vista has anything to do with the downturn in sales, as there is a financial crisis on at the moment and people are going to be tight with spending.
"If you really wanted to verify this, try and find out how Apple sales figures are doing.
"If Apple is down as well clearly there is a trend in the IT sector, however if its sales are up, well maybe people have had enough of being spoon fed Microsoft's "quality software".
Simon Vermey, owner of Your IT Support, said the slowdown of Microsoft's sales was driven by its desire to squeeze every last drop out of consumers for products that don't show any tangible improvement in performance or productivity.
"I have been and will continue to be a supporter, supplier and servicer of Windows based products due to the vast software and hardware base that has been created," he said.
"That having been said, recently I have purchased an Apple IMAC.
"In so doing I have come to believe we can buy computers like we purchase cars.
"We can have the "run around car" with it niggling issues and frustrations, or we can purchase the "luxury car" and enjoy its pleasures and focus on the destination rather than the problems getting there."
Vermey likened PCs as nothing more than the "ute - effective but not much more".
"Apple has managed to create a market of fine products, and people are starting to notice the refinements," he said.
"Microsoft should sit up and take notice.
"Consumers are not all gullible, they are starting to see the flaws in the PC market and spend more wisely."
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