Microsoft Corporation key statistics and ratios

In fiscal 2026, Microsoft Corporation had return on equity of 34.0%, an operating margin of 46.8%, debt equal to 10.4% of equity and a current ratio of 1.23. Each ratio below is calculated from the figures on its income statement, balance sheet and cash flow pages.

Financial ratios

US$ thousands unless shown otherwise. Fiscal years, plus the last twelve months (LTM) when newer.

Microsoft Corporation: financial ratios, annual
Fiscal year	2010Jun 2010	2011Jun 2011	2012Jun 2012	2013Jun 2013	2014Jun 2014	2015Jun 2015	2016Jun 2016	2017Jun 2017	2018Jun 2018	2019Jun 2019	2020Jun 2020	2021Jun 2021	2022Jun 2022	2023Jun 2023	2024Jun 2024	2025Jun 2025	2026Jun 2026	LTMSept 2026
Gross margin	80.2%	77.7%	76.2%	73.8%	68.8%	64.7%	64.0%	64.5%	65.2%	65.9%	67.8%	68.9%	68.4%	68.9%	69.8%	68.8%	67.9%	67.7%
Operating margin	38.6%	38.8%	29.5%	34.4%	32.0%	19.4%	28.6%	30.1%	31.8%	34.1%	37.0%	41.6%	42.1%	41.8%	44.6%	45.6%	46.8%	47.1%
Net margin	30.0%	33.1%	23.0%	28.1%	25.4%	13.0%	22.5%	26.4%	15.0%	31.2%	31.0%	36.5%	36.7%	34.1%	36.0%	36.1%	40.3%	41.2%
Free-cash-flow margin	35.4%	35.2%	39.8%	31.6%	31.1%	25.4%	27.4%	32.5%	29.2%	30.4%	31.6%	33.4%	32.9%	28.1%	30.2%	25.4%	20.2%	17.3%
Return on equity	40.6%	44.8%	27.5%	30.1%	26.2%	14.4%	25.2%	29.8%	19.4%	42.4%	40.1%	47.1%	47.2%	38.8%	37.1%	33.3%	34.0%	31.2%
Return on assets	21.8%	23.8%	14.8%	16.6%	14.0%	7.0%	11.2%	11.5%	6.5%	14.4%	15.1%	19.3%	20.8%	18.6%	19.1%	18.0%	19.4%	18.6%
Asset turnover	0.73	0.72	0.64	0.59	0.55	0.54	0.50	0.44	0.43	0.46	0.49	0.53	0.57	0.55	0.53	0.50	0.48	0.45
Current ratio	2.13	2.60	2.60	2.71	2.50	2.47	2.35	2.92	2.90	2.53	2.52	2.08	1.78	1.77	1.27	1.35	1.23	1.22
Debt to equity	12.9%	20.9%	18.0%	19.8%	25.2%	44.1%	64.4%	98.3%	92.2%	71.1%	57.0%	45.0%	33.3%	25.6%	19.2%	14.3%	10.4%	8.8%
Interest cover (operating income ÷ interest)	159.6x	92.1x	57.3x	62.4x	46.5x	23.3x	21.0x	13.1x	12.8x	16.0x	20.4x	29.8x	40.4x	45.0x	37.3x	53.9x	50.9x	50.6x
Effective tax rate	25.0%	17.5%	23.8%	19.2%	20.7%	34.1%	19.9%	14.8%	54.6%	10.2%	16.5%	13.8%	13.1%	19.0%	18.2%	17.6%	19.4%	19.7%
R&D as % of revenue	13.9%	12.9%	13.3%	13.4%	13.1%	12.9%	13.2%	13.5%	13.3%	13.4%	13.5%	12.3%	12.4%	12.8%	12.0%	11.5%	10.7%	10.5%
Capital spending as % of revenue	3.2%	3.4%	3.1%	5.5%	6.3%	6.4%	9.2%	8.4%	10.5%	11.1%	10.8%	12.3%	12.0%	13.3%	18.1%	22.9%	34.9%	39.2%
Free cash flow ÷ net income	117.8%	106.4%	172.7%	112.4%	122.4%	194.6%	121.6%	123.1%	194.6%	97.5%	102.2%	91.6%	89.6%	82.2%	84.0%	70.3%	50.1%	42.0%
Dividends ÷ net income	24.4%	22.4%	37.6%	34.1%	40.2%	81.0%	53.6%	46.5%	76.6%	35.2%	34.2%	27.0%	24.9%	27.4%	24.7%	23.6%	19.8%	19.0%
Dividends and buybacks ÷ free cash flow	71.7%	67.9%	38.9%	52.1%	59.9%	102.5%	108.0%	75.3%	72.6%	87.2%	84.2%	78.2%	78.0%	70.7%	52.7%	59.4%	72.7%	80.1%

US$ thousands unless shown otherwise. Fiscal quarters.

Microsoft Corporation: financial ratios, quarterly
Quarter	2025 Q2Dec 2024	2025 Q3Mar 2025	2025 Q4Jun 2025	2026 Q1Sept 2025	2026 Q2Dec 2025	2026 Q3Mar 2026	2026 Q4Jun 2026	2027 Q1Sept 2026
Gross margin	68.7%	68.7%	68.6%	69.0%	68.0%	67.6%	67.2%	67.8%
Operating margin	45.5%	45.7%	44.9%	48.9%	47.1%	46.3%	45.1%	49.8%
Net margin	34.6%	36.9%	35.6%	35.7%	47.3%	38.3%	39.7%	39.7%
Free-cash-flow margin	9.3%	29.0%	33.4%	33.0%	7.2%	19.1%	21.8%	20.2%
Current ratio	1.35	1.37	1.35	1.40	1.39	1.28	1.23	1.22
Debt to equity	14.9%	13.3%	12.6%	11.9%	10.3%	9.7%	9.1%	7.5%
R&D as % of revenue	11.4%	11.7%	11.6%	10.5%	10.5%	10.8%	11.1%	9.8%

Returns use average equity or assets over the year. Return on equity is left blank when equity is negative or so small that the ratio says nothing (above ±200%); interest cover is left blank above 200 times. Price-based ratios such as P/E are on the valuation page.

Financial health

6 of 7 checks passed · September 30, 2026

What it owns · $779.4bn

Short-term assets $186.1bnLonger-term assets $593.3bn

What it owes, and who funded it · $779.4bn

Short-term liabilities $152.0bnLonger-term liabilities $156.9bnShareholders' equity $470.5bn

Short-term assets cover short-term liabilities $186.1bn of assets due within a year against $152.0bn of liabilities due within a year.
Short-term assets cover long-term liabilities $186.1bn short-term assets against $156.9bn of longer-dated liabilities.
More cash than debt $20.3bn of cash against $35.5bn of debt.
Debt below 40% of shareholders' equity Debt is 8% of equity.
Debt burden no higher than five years ago Debt to equity moved from 30% to 8% over five years.
A year's operating cash flow covers at least 20% of debt $195.9bn of operating cash flow against $35.5bn of debt.
Operating profit covers interest at least five times over Operating income of $163.2bn against $3.2bn of interest.

From Microsoft Corporation's latest balance sheet as filed. Checks are fixed, documented rules (methodology), counted only where the company reports the figures — a dot means the filing doesn't break the item out. Descriptions of reported data, not advice.

Moat

90 /100

Strong moat

How hard Microsoft's competitive advantage looks for rivals to wear away, judged from 10 years of its own filings: returns on capital, pricing power, profit durability, cash conversion and discipline.

Returns on capital 20 / 20

Cash operating profit has been a median 27.2% of total assets over 10 years.
Pricing power 20 / 20

Gross margin has been a median 68.3%, moving by 1.5 percentage points (standard deviation) across 10 years.
Durability 20 / 20

Operating margin has been a median 41.9%; its worst year was 30.3%.
Cash conversion 20 / 20

Free cash flow was positive in 10 of 10 years, at a median 29.4% of revenue.
Discipline 15 / 20

The diluted share count fell 1.9% over five years; stock-based pay has been a median 3.7% of revenue.

AI disruption exposure: Medium. In this industry, AI could change how the product is made or sold, without replacing the core asset. The score above includes a 5-point deduction for that exposure (95 before it).

A rules-based reading of reported figures, not a forecast and not investment advice. How the score is built: methodology.

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Figures from Microsoft Corporation's SEC filings (10-K and 10-Q), retrieved October 29, 2026. How we read and check them: methodology and data sources. Not investment advice. Back to Microsoft Corporation.