Stock Analysis on Net

Microsoft Corp. (NASDAQ:MSFT)

$24.99

Debt to Equity
since 2005

Microsoft Excel

Calculation

Microsoft Corp., debt to equity, long-term trends, calculation

Microsoft Excel

Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30), 10-K (reporting date: 2016-06-30), 10-K (reporting date: 2015-06-30), 10-K (reporting date: 2014-06-30), 10-K (reporting date: 2013-06-30), 10-K (reporting date: 2012-06-30), 10-K (reporting date: 2011-06-30), 10-K (reporting date: 2010-06-30), 10-K (reporting date: 2009-06-30), 10-K (reporting date: 2008-06-30), 10-K (reporting date: 2007-06-30), 10-K (reporting date: 2006-06-30), 10-K (reporting date: 2005-06-30).

1 US$ in millions

The financial data reveals several significant trends relating to the company's capital structure and balance sheet strength over the period analyzed.

Total debt and finance lease liabilities (in millions of US dollars)

From 2010 onwards, total debt showed a clear upward trajectory, beginning at $5,746 million and rising sharply to a peak of $88,732 million in 2017. Following this peak, there was a decline in debt levels through 2023, stabilizing around $64,304 million before increasing somewhat again to $78,775 million in 2024. This pattern suggests a phase of aggressive leveraging followed by a period of deleveraging or stabilization in recent years.

Stockholders’ equity (in millions of US dollars)

Stockholders’ equity exhibited a consistent and strong growth trend over the entire period. Starting from $48,115 million in 2005, equity rose to $268,477 million by 2024. The growth was relatively steady, with particularly notable increases between 2017 and 2024, indicating substantial accumulation of retained earnings or capital injections that have strengthened the company’s net worth.

Debt to equity ratio

The debt to equity ratio, available from 2010 onward, demonstrates an initial increase from 0.15 in 2010 to a peak of 1.23 in 2016, indicating that debt grew faster than equity during this interval which aligns with the debt peak observed. After 2016, this ratio declined markedly to 0.29 by 2024, reflecting a reduction in leverage relative to equity. This suggests a strategic shift towards a more conservative capital structure and possibly reduced financial risk.

Overall, the data indicates that the company initially expanded its leverage substantially, likely to finance growth or acquisitions, which was followed by a period of deleveraging and equity growth. The significant rise in equity alongside a reduced debt-to-equity ratio in the later years points to an improvement in financial stability and potentially greater borrowing capacity or resilience to economic fluctuations.


Comparison to Competitors

Microsoft Corp., debt to equity, long-term trends, comparison to competitors

Microsoft Excel

Based on: 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30), 10-K (reporting date: 2017-06-30), 10-K (reporting date: 2016-06-30), 10-K (reporting date: 2015-06-30), 10-K (reporting date: 2014-06-30), 10-K (reporting date: 2013-06-30), 10-K (reporting date: 2012-06-30), 10-K (reporting date: 2011-06-30), 10-K (reporting date: 2010-06-30), 10-K (reporting date: 2009-06-30), 10-K (reporting date: 2008-06-30), 10-K (reporting date: 2007-06-30), 10-K (reporting date: 2006-06-30), 10-K (reporting date: 2005-06-30).


Comparison to Sector (Software & Services)


Comparison to Industry (Information Technology)