The Reputation of Microsoft never recovered following the release of Windows Vista, according to Steve Ballmer, the company's CEO.

Microsoft's reputation was severly damaged following the Vista release, which contained a number of large issues.

"We got some uneven reception when [Vista] first launched in large part because we made some design decisions to improve security at the expense of compatibility. I don't think from a word-of-mouth perspective we ever recovered from that." said Mr Ballmer

Mr Ballmer said: "Microsoft continues on the acquisition trail and is likely to buy around 15 companies this year, in line with previous years."

When asked whether Microsoft would buy Twitter, he said the micro-blogging site does not "want to be bought".

This is "by far" the worst period for Microsoft in his 30 years at the company. The spending within businesses has dropped by between 15pc and 20pc, while consumer demand has plunged.

He also said that: "It doesn't look like things are going to change any time soon, and we're planning our cost structure on that basis."

Mr Ballmer said Microsoft "screwed up with Windows Mobile" and changed the Windows Mobile team recently to try to recoup losses.

Microsoft have pushed through a release of its redesigned Windows Mobile operating system to combat the successes of Apple's iPhone and Google's Android mobile operating system.