Stock Analysis on Net

Microsoft Corp. (NASDAQ:MSFT)

$24.99

Return on Assets (ROA)
since 2005

Microsoft Excel

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Calculation

Microsoft Corp., ROA, 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 analysis of the financial data over the given periods reveals several key trends related to profitability, asset growth, and return on assets (ROA).

Net Income
Net income exhibits a generally upward trajectory over the years with some fluctuations. From 2005 to 2008, there is a steady increase from approximately 12.3 billion USD to 17.7 billion USD, followed by some volatility. Between 2008 and 2012, net income sees decreases and increases, reaching a low in 2011–2012 before rising substantially in later years. A pronounced surge occurs after 2018, peaking around 44.3 billion USD in 2020 and continuing to increase, reaching over 88 billion USD in 2024. This surge indicates strong profitability improvement in recent years.
Total Assets
Total assets demonstrate consistent growth throughout the entire period. Starting around 70.8 billion USD in 2005, assets increase steadily, accelerating especially after 2012. By 2024, total assets have grown to over 512 billion USD, more than a sevenfold increase. This robust asset base expansion suggests significant investment, acquisition activity, or organic growth of company operations.
Return on Assets (ROA)
ROA shows a pattern of fluctuations. Initially high at 17.3% in 2005, it peaks at 24.3% in 2008, then declines steadily to a low point around 6.4% in 2018. After 2018, ROA improves notably, climbing back toward the 17%–20% range by 2022–2024. The initial decline may correspond with rapid asset base expansion outpacing net income growth, while the later recovery in ROA reflects improved utilization of assets to generate profit.

In summary, the company has significantly expanded its asset base over the analyzed period, which initially caused a reduction in ROA as growth outpaced income. However, recent years show a marked improvement in profitability as net income rises substantially and asset efficiency improves. This overall trend suggests an increasing capacity to generate returns on a much larger asset base, highlighting enhanced operational effectiveness and financial strength.


Comparison to Competitors

Microsoft Corp., ROA, 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)