Microsoft should have ended the year 2000 on a triumphant note: after preparing its customers for a future of software services, it shipped its first .NET deliverables---beta versions of the .NET Framework and Visual Studio---and its first beta of Whistler, a coming major release of Windows. Instead, Microsoft entered the holidays on a dour note by announcing that its original financial guidelines for the quarter ending December 31, 2000 were off by 5 to 6 percent.

“We believe, like many other technology companies, that the current weakness in worldwide economic conditions is resulting in a slowdown in PC sales, corporate IT spending, and consumer online services and advertising,” Microsoft CFO John Connors said in a press release. “While our short-term results will continue to be affected by the current economic environment, our long-term outlook on the information technology market and the PC industry remains positive. We have a lineup of new products and technologies that are receiving rave reviews from customers, and we continue to be very excited about the progress we are making across all our businesses.”