Microsoft Executives Try To Calm Stock Analysts Company Remains Cautious About Prospects For Future

Microsoft Corp. executives talked a mixture of caution and glee at their annual conference with stock analysts Thursday, in part because downbeat comments by company officials contributed to a sell-off of Microsoft and other technology stocks earlier this week.

“I hope you get a fairly cautionary note out of my talk,” said Steve Ballmer, Microsoft executive vice president.

“I don’t want to be Dr. Doom and Gloom since we have done a super job” on Windows and other company products this year, he added.

Normally, the summertime gathering at Microsoft’s park-like corporate headquarters is a chance to review financial figures, hear some generalized forecasts and take a carefully orchestrated look at the company’s new products.

Chairman Bill Gates also talks about the state of the computer industry, makes some predictions and shares other aspects of his vision for the world’s largest personal-computer software company.

It’s an unofficial tradition that company executives also warn that Microsoft’s phenomenal growth can’t last forever. While accepted as true, such cautionary words often have been overshadowed by Microsoft’s consistent strong performance and rising stock price.

This year, however, someone’s been listening.

Microsoft has become a bellwether among technology stocks. Doubts about its future and that of other computer stocks were enough to spark a sell-off Tuesday and Wednesday that dropped Microsoft’s share value by 13 percent.

It’s also one of the most critical times in Microsoft’s 20-year history, as the company prepares to launch Windows 95, the long-awaited sequel to the operating system for most of the world’s personal computers. The product, due out Aug. 24, has to be a hit not only for Microsoft but for the entire industry, as hundreds of companies have invested heavily in new products to work with Windows 95.

But while Microsoft should get a sales spike from Windows 95 and related products this year, there are a lot of factors that could derail the company’s success, Ballmer said.

He listed a number of them - questions about whether the rapid growth in personal computer sales will continue, “desperate” competition from rivals who have lost market share recently, and expanding costs both for research and development and marketing.