It's been a bumpy ride for shareholders of Limelight Networks since the maker of online content delivery technology went public last summer.

Following their first day of trading on June 8, when the company's stock reached a high of $24.33, Limelight shares have slid 70%, to $6.64 late Monday.

While the price held steady Monday, shareholders got a glimmer of good news Friday when Limelight's stock rallied more than 10% after the company said revenue would come at the high end of previously announced guidance. Adding to the bump was renewed speculation that Microsoft Corp. could acquire the company.

Tempe, Ariz.-based Limelight provides a content delivery network, or CDN, that enables companies to digitally deliver content and streaming media for video, music and video games. It said Friday that revenue for the fourth quarter would be in the range of $29.3 million to $30 million, the high end of the $28 million to $30 million range it provided back in November.

"An inline quarter given the negative sentiment of the stock is good news right now," said a market analyst who asked not to be identified.

After a successful debut that launched Limelight's shares 45% in their first day of trading, the stock began to crumble a month later when analysts initiated coverage with less-than-stellar support for the company. Shares took a 40% hit in August, when second quarter earnings missed expectations and it lowered revenue guidance for the third quarter, due mainly to pricing pressures from rival Akamai Technologies. They dropped further in November, when the company again guided revenue below market expectations.

"The management team is really in the penalty box for guiding below the Street each time they've come out with guidance," said Michael Turits, analyst with Raymond James & Associates.

Turits said the company remains susceptible to pricing pressures and its business also could be impacted by the ongoing Hollywood writers' strike due to less content being produced.

But the analyst last month upgraded Limelight to outperform from market perform with a 12-month price target of $10. In a research note, he wrote that investments in the content delivery network business by AT&T Inc. of San Antonio and Level 3 Communications Inc. "validate the market," and "should create a takeout premium" for Limelight, the No. 2 provider in the sector.

Indeed, rumors that Microsoft could acquire Limelight have provided some support for the depressed shares. Speculation that the Redmond, Wash., software giant could be sniffing around Limelight first surfaced in August after the company divulged that Microsoft would use its content distribution network to distribute multimedia, including video, music, games, software and social media.

Turits, however, said he views telecommunications carriers as the most likely buyers for Limelight and would expect potential acquirers to consider buying Limelight with its stock price depressed. Despite the issues it faces, the company remains the second largest player in the CDN market with a 10% share of the market (Akamai owned roughly 70% of the market in 2007), making it a viable buyout candidate, he said.

"My view has been that Akamai and Limelight have an enormous lead on everyone in the CDN space in terms of vendor viability," Turits said. "Even though Limelight's market share is somewhat small, their mindshare is quite large."

In order for any acquisition talks to heat up, Limelight likely will have to resolve outstanding litigation against it by both Akamai, of Cambridge, Mass., and Level 3, of Broomfield, Colo. Both companies have sued Limelight for patent infringement.

There also is a question about just how amenable Limelight management would be to a deal with its share price depressed. They may not want to sell for less than its IPO price of $15 a share, or $1.2 billion.

Turits said even at $15 a share, Limelight would be trading at a discount to Akamai based on revenue, though he acknowledges that Akamai is more worthy of its premium due to its industry leading position and superior profitability.