There was a time when Microsoft was the darling of Wall Street. IBM was still in the personal computer business in those days and had a next generation operating system called OS/2, which I liked and frequently wrote about. Mine was a lonely voice because IBM was considered the old dinosaur of computing, while Microsoft was the fast rising favorite which could do no wrong.

Today it is Microsoft which can’t seem to get any respect, especially from the financial know-it-alls. In recent weeks, the financial headlines have been dominated by negative comments about the company’s prospects. Following stellar quarterly reports from Apple and Google, the drumbeats of doom reached a crescendo, with reporters on a certain four-letter business network asking, “Is Microsoft toast?”

So what do we get when Microsoft posts results for the quarter ending March 31? A blow out. Windows Vista sales, which the pundits claimed were sluggish, ran ahead of plan. And profits from sales of the new Office release and server software also ran well ahead of the “experts” estimates.

Take a look at a tale of the tape:

I’m not arguing that Google and Apple aren’t doing very well, they are. Google was not the first internet search company, but it arrived with a search method clearly superior to anything that came before it and quickly gained a dominate share of the market. More importantly, it figured out how to make money by selling search related advertising, something which had eluded its predecessors. Microsoft has tried very hard to gain a foothold with its own search products but has not made much of a dent in Google’s business.

Apple didn’t invent the graphical user interface, but its Macintosh introduced it to the general public with an ease of use and elegant design which set it apart from the personal computers that came before. It didn’t invent the portable music player either, but its iPod took the market by storm; and Microsoft, which has a competing product called the Zune, hasn’t dented Apple’s market share either.

Yet, and at the risk of attracting email from Macintosh fans who write every time I report something positive about Microsoft, I’d be cautious about declaring the Windows crowd “toast” any time soon. Google has numerous projects in various stages of development, trying to expand beyond “search” as well as grow its presence in the general advertising space. So far it has not demonstrated the viability of any of these projects.

Apple, despite all the buzz and its very clever anti-Windows commercials, remains a niche player. I’ve read many a pundit write that we should all buy Macintosh machines, especially now that they have Intel processors and can run Windows programs. That’s true, but every time I price a Mac I find it costs about 50% more than a comparable Windows machine. That’s a big price to pay for an elegant design. So far, there is nothing to indicate the Mac will break out from the niche player status it has held amongst businesses and consumers for many, many years.

IBM met the challenge of the personal computer revolution by completely rewriting its business model. There is no reason to believe Microsoft won’t meet the challenges it faces in an equally successful fashion. Following its earnings report, Microsoft received a number of ratings upgrades from the same Wall Street analysts who were naysayers just a week before. They’re taking a second look at IBM too!