"Factors such as the flooding in Thailand, macroeconomic uncertainty and competing form factors resulted in an overall market that we estimate declined 2 percent to 4 percent," said Bill Koefoed, Microsoft's general manager for investor relations, during the prepared statement section of the call.
Microsoft is pinning its plan for a resurgence in Windows revenue on the next iteration of the OS, Windows 8.
"With the future release of Windows 8, we believe the ecosystem will benefit from the new range of capabilities and scenarios that it enables," said Peter Klein, Microsoft's chief financial officer.
Krans went further. "Windows 8 ... will be a pivotal moment in the long-term durability of the Windows brand," he said.
Overall, Microsoft reported revenue up 5 percent over the same quarter a year ago, with the Server & Tools group boosting its operating income by 11 percent and the Business division up 3 percent.
Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer, on Google+ or subscribe to Gregg's RSS feed. His email address is email@example.com.
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