Return on Equity (ROE)
since 2005
Calculation
Microsoft Corp., ROE, long-term trends, calculation
| ROE | = | 100 | × | Net income1 | ÷ | Stockholders’ equity1 | |
|---|---|---|---|---|---|---|---|
| Jun 30, 2026 | 30.23% | = | 100 | × | 133,749) | ÷ | 442,387) |
| Jun 30, 2025 | 29.65% | = | 100 | × | 101,832) | ÷ | 343,479) |
| Jun 30, 2024 | 32.83% | = | 100 | × | 88,136) | ÷ | 268,477) |
| Jun 30, 2023 | 35.09% | = | 100 | × | 72,361) | ÷ | 206,223) |
| Jun 30, 2022 | 43.68% | = | 100 | × | 72,738) | ÷ | 166,542) |
| Jun 30, 2021 | 43.15% | = | 100 | × | 61,271) | ÷ | 141,988) |
| Jun 30, 2020 | 37.43% | = | 100 | × | 44,281) | ÷ | 118,304) |
| Jun 30, 2019 | 38.35% | = | 100 | × | 39,240) | ÷ | 102,330) |
| Jun 30, 2018 | 20.03% | = | 100 | × | 16,571) | ÷ | 82,718) |
| Jun 30, 2017 | 29.29% | = | 100 | × | 21,204) | ÷ | 72,394) |
| Jun 30, 2016 | 23.33% | = | 100 | × | 16,798) | ÷ | 71,997) |
| Jun 30, 2015 | 15.23% | = | 100 | × | 12,193) | ÷ | 80,083) |
| Jun 30, 2014 | 24.59% | = | 100 | × | 22,074) | ÷ | 89,784) |
| Jun 30, 2013 | 27.69% | = | 100 | × | 21,863) | ÷ | 78,944) |
| Jun 30, 2012 | 25.58% | = | 100 | × | 16,978) | ÷ | 66,363) |
| Jun 30, 2011 | 40.55% | = | 100 | × | 23,150) | ÷ | 57,083) |
| Jun 30, 2010 | 40.63% | = | 100 | × | 18,760) | ÷ | 46,175) |
| Jun 30, 2009 | 36.83% | = | 100 | × | 14,569) | ÷ | 39,558) |
| Jun 30, 2008 | 48.73% | = | 100 | × | 17,681) | ÷ | 36,286) |
| Jun 30, 2007 | 45.23% | = | 100 | × | 14,065) | ÷ | 31,097) |
| Jun 30, 2006 | 31.42% | = | 100 | × | 12,599) | ÷ | 40,104) |
| Jun 30, 2005 | 25.47% | = | 100 | × | 12,254) | ÷ | 48,115) |
Based on: 10-K (reporting date: 2026-06-30), 10-K (reporting date: 2025-06-30), 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 trajectory from 2005 to 2026 is characterized by substantial growth in absolute earnings and equity, accompanied by significant fluctuations in the efficiency of capital utilization as measured by Return on Equity (ROE).
- Net Income Trends
- Net income demonstrates a long-term upward trend, increasing from 12,254 million USD in 2005 to a projected 133,749 million USD by 2026. A period of relative stability occurred between 2005 and 2015, followed by an aggressive growth phase starting in 2019, where annual net income more than tripled between 2019 and 2026.
- Stockholders' Equity Evolution
- Equity levels experienced an initial decline between 2005 and 2007, dropping from 48,115 million USD to 31,097 million USD. This was followed by a consistent accumulation of equity over the subsequent two decades. The most rapid expansion occurred after 2020, with equity growing from 118,304 million USD in 2019 to 442,387 million USD by 2026.
- Return on Equity (ROE) Analysis
- ROE exhibited three distinct phases. The first phase (2005–2008) saw a sharp increase, peaking at 48.73%. The second phase (2009–2015) was marked by volatility and a downward trend, reaching a minimum of 15.23% in 2015. The third phase (2016–2026) shows a recovery to levels above 40% by 2022, followed by a gradual moderation toward 30.23% as the growth in stockholders' equity began to outpace the growth rate of net income.
The correlation between the expanding equity base and the moderating ROE in the final years of the period suggests a transition toward a more capital-intensive structure or a stabilization of profit margins relative to the massive increase in retained earnings and capital reserves.
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Comparison to Competitors
Microsoft Corp., ROE, long-term trends, comparison to competitors
| Microsoft Corp. | Accenture PLC | Adobe Inc. | AppLovin Corp. | Cadence Design Systems Inc. | CrowdStrike Holdings Inc. | Datadog Inc. | International Business Machines Corp. | Intuit Inc. | Oracle Corp. | Palantir Technologies Inc. | Palo Alto Networks Inc. | Salesforce Inc. | ServiceNow Inc. | Synopsys Inc. | Workday Inc. | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Jun 30, 2026 | 30.23% | — | — | — | — | -3.67% | — | — | — | 40.20% | — | — | 12.61% | — | — | 8.88% |
| Jun 30, 2025 | 29.65% | 24.61% | 61.34% | 156.17% | 20.26% | -0.59% | 2.89% | 32.45% | 19.63% | 60.84% | 22.00% | 14.49% | 10.13% | 13.48% | 4.70% | 5.82% |
| Jun 30, 2024 | 32.83% | 25.68% | 39.42% | 144.96% | 22.58% | 3.88% | 6.77% | 22.06% | 16.07% | 120.26% | 9.24% | 49.86% | 6.93% | 14.83% | 25.17% | 17.09% |
| Jun 30, 2023 | 35.09% | 26.75% | 32.86% | 28.39% | 30.58% | -12.52% | 2.40% | 33.29% | 13.81% | 792.45% | 6.04% | 25.15% | 0.36% | 22.69% | 20.01% | -6.57% |
| Jun 30, 2022 | 43.68% | 31.11% | 33.85% | -10.13% | 30.93% | -22.89% | -3.56% | 7.47% | 12.57% | — | -14.57% | -127.14% | 2.48% | 6.46% | 17.85% | 0.65% |
| Jun 30, 2021 | 43.15% | 30.25% | 32.59% | 1.66% | 25.39% | -10.64% | -1.99% | 30.38% | 20.89% | 262.43% | -22.71% | -78.63% | 9.81% | 6.22% | 14.31% | -8.62% |
| Jun 30, 2020 | 37.43% | 30.05% | 39.66% | — | 23.69% | -19.10% | -2.56% | 27.14% | 35.76% | 83.94% | -76.61% | -24.23% | 0.37% | 4.18% | 13.54% | -19.33% |
| Jun 30, 2019 | 38.35% | 33.17% | 28.03% | — | 47.03% | — | -2.14% | 45.25% | 41.53% | 50.87% | — | -5.16% | 7.11% | 29.45% | 13.04% | -21.36% |
| Jun 30, 2018 | 20.03% | 39.17% | 27.67% | — | 26.84% | — | — | 51.96% | 51.44% | 8.37% | — | -15.30% | 1.36% | -2.40% | 12.43% | -20.33% |
| Jun 30, 2017 | 29.29% | 38.50% | 20.02% | — | 20.63% | — | — | 32.70% | 71.71% | 17.33% | — | -28.52% | 2.40% | -25.53% | 4.17% | -35.11% |
| Jun 30, 2016 | 23.33% | 54.42% | 15.74% | — | 27.38% | — | — | 65.07% | 84.32% | 18.82% | — | -28.60% | -0.95% | -116.76% | 8.35% | -25.52% |
| Jun 30, 2015 | 15.23% | 49.78% | 8.99% | — | 18.34% | — | — | 92.48% | 15.65% | 20.42% | — | -33.81% | -6.61% | -35.01% | 7.21% | -22.02% |
| Jun 30, 2014 | 24.59% | 51.32% | 3.96% | — | 11.92% | — | — | 101.30% | 29.47% | 23.37% | — | -48.33% | -7.64% | -41.85% | 8.48% | -14.53% |
| Jun 30, 2013 | 27.69% | 66.16% | 4.31% | — | 14.21% | — | — | 72.32% | 24.30% | 24.47% | — | -10.74% | -11.67% | -18.70% | 8.89% | -20.12% |
| Jun 30, 2012 | 25.58% | 61.59% | 12.49% | — | 48.07% | — | — | 88.04% | 28.86% | 22.85% | — | 0.32% | -0.73% | -15.34% | 7.29% | — |
| Jun 30, 2011 | 40.55% | 58.72% | 14.40% | — | 17.57% | — | — | 78.73% | 24.24% | 21.49% | — | — | 5.05% | — | 10.53% | — |
| Jun 30, 2010 | 40.63% | 62.79% | 14.92% | — | 45.74% | — | — | 64.36% | 20.35% | 19.92% | — | — | 7.73% | — | 11.29% | — |
| Jun 30, 2009 | 36.83% | 55.08% | 7.90% | — | -138.29% | — | — | 59.31% | 17.49% | 22.29% | — | — | 6.46% | — | 9.09% | — |
| Jun 30, 2008 | 48.73% | 66.59% | 19.77% | — | -1,818.25% | — | — | 91.60% | 23.00% | 23.98% | — | — | 4.06% | — | 12.43% | — |
| Jun 30, 2007 | 45.23% | 60.25% | 15.57% | — | 14.24% | — | — | 36.59% | 21.62% | 25.26% | — | — | 0.17% | — | 9.08% | — |
| Jun 30, 2006 | 31.42% | 51.38% | 9.82% | — | 8.39% | — | — | 33.30% | 23.99% | 22.52% | — | — | 14.50% | — | 2.13% | — |
| Jun 30, 2005 | 25.47% | 55.42% | 32.34% | — | 2.67% | — | — | 23.97% | 22.51% | 26.63% | — | — | 5.06% | — | -1.27% | — |
Based on: 10-K (reporting date: 2026-06-30), 10-K (reporting date: 2025-06-30), 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)
Microsoft Corp., ROE, long-term trends, comparison to sector (software & services)
| Microsoft Corp. | Software & Services | |
|---|---|---|
| Jun 30, 2026 | 30.23% | — |
| Jun 30, 2025 | 29.65% | 26.75% |
| Jun 30, 2024 | 32.83% | 28.69% |
| Jun 30, 2023 | 35.09% | 28.33% |
| Jun 30, 2022 | 43.68% | 30.61% |
| Jun 30, 2021 | 43.15% | 35.77% |
| Jun 30, 2020 | 37.43% | 30.18% |
| Jun 30, 2019 | 38.35% | 35.56% |
| Jun 30, 2018 | 20.03% | 20.20% |
| Jun 30, 2017 | 29.29% | 23.83% |
| Jun 30, 2016 | 23.33% | 26.25% |
| Jun 30, 2015 | 15.23% | 23.04% |
| Jun 30, 2014 | 24.59% | 28.09% |
| Jun 30, 2013 | 27.69% | 31.71% |
| Jun 30, 2012 | 25.58% | 32.66% |
| Jun 30, 2011 | 40.55% | 38.82% |
| Jun 30, 2010 | 40.63% | 37.89% |
| Jun 30, 2009 | 36.83% | 35.98% |
| Jun 30, 2008 | 48.73% | 44.03% |
| Jun 30, 2007 | 45.23% | 35.48% |
| Jun 30, 2006 | 31.42% | 28.87% |
| Jun 30, 2005 | 25.47% | 24.91% |
Based on: 10-K (reporting date: 2026-06-30), 10-K (reporting date: 2025-06-30), 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 Industry (Information Technology)
Microsoft Corp., ROE, long-term trends, comparison to industry (information technology)
| Microsoft Corp. | Information Technology | |
|---|---|---|
| Jun 30, 2026 | 30.23% | — |
| Jun 30, 2025 | 29.65% | 34.73% |
| Jun 30, 2024 | 32.83% | 29.28% |
| Jun 30, 2023 | 35.09% | 31.78% |
| Jun 30, 2022 | 43.68% | 38.79% |
| Jun 30, 2021 | 43.15% | 42.14% |
| Jun 30, 2020 | 37.43% | 35.58% |
| Jun 30, 2019 | 38.35% | 36.48% |
| Jun 30, 2018 | 20.03% | 30.38% |
| Jun 30, 2017 | 29.29% | 23.35% |
| Jun 30, 2016 | 23.33% | 23.33% |
| Jun 30, 2015 | 15.23% | 26.15% |
| Jun 30, 2014 | 24.59% | 25.61% |
| Jun 30, 2013 | 27.69% | 24.89% |
| Jun 30, 2012 | 25.58% | 26.24% |
| Jun 30, 2011 | 40.55% | 29.22% |
| Jun 30, 2010 | 40.63% | 27.89% |
| Jun 30, 2009 | 36.83% | 20.28% |
| Jun 30, 2008 | 48.73% | 25.67% |
| Jun 30, 2007 | 45.23% | 24.01% |
| Jun 30, 2006 | 31.42% | 22.74% |
| Jun 30, 2005 | 25.47% | 22.11% |
Based on: 10-K (reporting date: 2026-06-30), 10-K (reporting date: 2025-06-30), 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).