Microsoft Thursday reported revenue for the June quarter that was down 17 percent on net income that was down 29 percent year over year, missing analysts' forecasts. The results sent its stock price plunging more than 8 percent Friday, though it rebounded to close at US$23.45, only slightly lower than its opening price.

Microsoft's quarter proves the company, which has weathered other economic storms soundly, is not completely immune to the global economic crisis and actually may be getting hit harder than some competitors because of the scale and geographic reach of its products, said Matt Rosoff, an analyst with Directions on Microsoft.

"They're coming from a bigger base," he said. "When they fall, they fall farther."

Microsoft's results also show early effects of competitive pressure from the lower end of the markets for its two key products, Windows and Office, Rosoff said.

Netbooks, which run both Windows and Linux, are still cutting into the Windows PC market, while a 30 percent drop in consumer sales for Microsoft Office suite -- which Microsoft did not directly discuss Thursday -- could show pressure from Web-based office suites from Google and others, Rosoff said. "Pressure on the low end is certainly a factor," he said.