30 years of historical data (1996–2025) · Technology · Software - Infrastructure
Percentile shows where the current value sits in 30-year historical distribution. Sparklines show 5-year trend.
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
Microsoft Corporation trades at 28.8x earnings, 15% below its 5-year average of 34.0x, sitting at the 47th percentile of its historical range. Compared to the Technology sector median P/E of 25.2x, the stock trades at a premium of 14%. On a free-cash-flow basis, the stock trades at 40.7x P/FCF, roughly in line with the 5-year average of 41.2x.
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $2.92T | $3.71T | $3.34T | $2.54T | $1.94T | $2.06T | $1.56T | $1.04T | $768.6B | $539.9B | $410.0B |
| Enterprise Value | $2.95T | $3.74T | $3.39T | $2.57T | $1.98T | $2.11T | $1.62T | $1.11T | $838.4B | $623.8B | $457.0B |
| P/E Ratio → | 28.79 | 36.47 | 37.88 | 35.18 | 26.61 | 33.65 | 35.33 | 26.47 | 46.30 | 21.21 | 24.37 |
| P/S Ratio | 10.36 | 13.18 | 13.62 | 12.01 | 9.77 | 12.26 | 10.93 | 8.25 | 6.96 | 5.59 | 4.50 |
| P/B Ratio | 8.54 | 10.81 | 12.43 | 12.34 | 11.63 | 14.52 | 13.22 | 10.15 | 9.29 | 6.15 | 5.70 |
| P/FCF | 40.74 | 51.85 | 45.07 | 42.78 | 29.72 | 36.73 | 34.57 | 27.15 | 23.83 | 17.21 | 16.41 |
| P/OCF | 21.43 | 27.27 | 28.16 | 29.05 | 21.75 | 26.86 | 25.77 | 19.90 | 17.51 | 13.66 | 12.30 |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
Microsoft Corporation's enterprise value stands at 18.1x EBITDA, 25% below its 5-year average of 24.0x. The Technology sector median is 15.7x, placing the stock at a 15% premium on an enterprise-value basis.
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 13.29 | 13.82 | 12.13 | 10.01 | 12.58 | 11.33 | 8.79 | 7.60 | 6.46 | 5.01 |
| EV / EBITDA | 18.12 | 23.01 | 25.71 | 25.10 | 20.28 | 25.91 | 24.65 | 20.23 | 18.50 | 16.50 | 13.97 |
| EV / EBIT | 22.94 | 29.71 | 30.59 | 28.15 | 23.13 | 28.79 | 29.14 | 23.84 | 21.38 | 19.42 | 17.00 |
| EV / FCF | — | 52.28 | 45.73 | 43.21 | 30.45 | 37.68 | 35.84 | 28.90 | 26.00 | 19.88 | 18.29 |
Margins and return-on-capital ratios measuring operating efficiency
Microsoft Corporation earns an operating margin of 45.6%. Operating margins have expanded from 41.8% to 45.6% over the past 3 years, signaling improving operational efficiency. Return on equity of 33.3% is exceptionally high. ROIC of 27.9% represents excellent returns on invested capital.
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 68.8% | 68.8% | 69.8% | 68.9% | 68.4% | 68.9% | 67.8% | 65.9% | 65.2% | 64.5% | 64.0% |
| Operating Margin | 45.6% | 45.6% | 44.6% | 41.8% | 42.1% | 41.6% | 37.0% | 34.1% | 31.8% | 30.1% | 28.6% |
| Net Profit Margin | 36.1% | 36.1% | 36.0% | 34.1% | 36.7% | 36.5% | 31.0% | 31.2% | 15.0% | 26.4% | 22.5% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 33.3% | 33.3% | 37.1% | 38.8% | 47.2% | 47.1% | 40.1% | 42.4% | 19.4% | 31.9% | 27.0% |
| ROA | 18.0% | 18.0% | 19.1% | 18.6% | 20.8% | 19.3% | 15.1% | 14.4% | 6.5% | 11.5% | 11.2% |
| ROIC | 27.9% | 27.9% | 29.9% | 29.8% | 30.5% | 28.2% | 23.0% | 20.0% | 16.2% | 15.0% | 17.1% |
| ROCE | 29.7% | 29.7% | 31.5% | 30.7% | 32.4% | 29.5% | 23.7% | 20.6% | 17.8% | 17.7% | 20.1% |
Solvency and debt-coverage ratios — lower is generally safer
Microsoft Corporation carries a Debt/EBITDA ratio of 0.4x, which is very conservative (87% below the sector average of 3.0x). Net debt stands at $30.3B ($60.6B total debt minus $30.2B cash). Interest coverage of 53.9x signals virtually no risk of debt distress — earnings comfortably cover interest obligations.
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.18 | 0.18 | 0.25 | 0.29 | 0.37 | 0.48 | 0.60 | 0.77 | 0.99 | 1.04 | 0.74 |
| Debt / EBITDA | 0.37 | 0.37 | 0.51 | 0.59 | 0.63 | 0.83 | 1.08 | 1.43 | 1.81 | 2.42 | 1.63 |
| Net Debt / Equity | — | 0.09 | 0.18 | 0.12 | 0.28 | 0.38 | 0.49 | 0.65 | 0.84 | 0.96 | 0.65 |
| Net Debt / EBITDA | 0.19 | 0.19 | 0.37 | 0.25 | 0.48 | 0.66 | 0.87 | 1.23 | 1.54 | 2.22 | 1.44 |
| Debt / FCF | — | 0.42 | 0.66 | 0.42 | 0.73 | 0.95 | 1.27 | 1.75 | 2.17 | 2.67 | 1.88 |
| Interest Coverage | 53.89 | 53.89 | 37.29 | 44.98 | 40.42 | 29.80 | 20.44 | 15.99 | 12.83 | 13.06 | 20.98 |
Short-term solvency ratios and asset-utilisation metrics
A current ratio of 1.35x means Microsoft Corporation can comfortably meet its short-term obligations, though there is limited excess liquidity. The current ratio has declined from 1.77x to 1.35x over the past 3 years.
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 1.35 | 1.35 | 1.27 | 1.77 | 1.78 | 2.08 | 2.52 | 2.53 | 2.90 | 2.92 | 2.35 |
| Quick Ratio | 1.35 | 1.35 | 1.27 | 1.75 | 1.75 | 2.05 | 2.49 | 2.50 | 2.86 | 2.88 | 2.31 |
| Cash Ratio | 0.67 | 0.67 | 0.60 | 1.07 | 1.10 | 1.47 | 1.89 | 1.93 | 2.29 | 2.39 | 1.91 |
| Asset Turnover | — | 0.46 | 0.48 | 0.51 | 0.54 | 0.50 | 0.47 | 0.44 | 0.43 | 0.39 | 0.47 |
| Inventory Turnover | 93.64 | 93.64 | 59.48 | 26.35 | 16.74 | 19.81 | 24.32 | 20.80 | 14.41 | 15.71 | 14.56 |
| Days Sales Outstanding | — | 90.57 | 84.76 | 83.86 | 81.48 | 82.61 | 81.70 | 85.63 | 87.58 | 84.78 | 73.19 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Microsoft Corporation returns 1.5% to shareholders annually — split between a 0.8% dividend yield and 0.6% buyback yield. The payout ratio of 23.6% is conservative, leaving significant room for dividend growth or reinvestment. The earnings yield of 3.5% (inverse of P/E) provides a useful comparison to bond yields when assessing the stock's relative attractiveness to fixed income.
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | 0.8% | 0.6% | 0.7% | 0.8% | 0.9% | 0.8% | 1.0% | 1.3% | 1.7% | 2.2% | 2.7% |
| Payout Ratio | 23.6% | 23.6% | 24.7% | 27.4% | 24.9% | 27.0% | 34.2% | 35.2% | 76.6% | 46.5% | 53.6% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 3.5% | 2.7% | 2.6% | 2.8% | 3.8% | 3.0% | 2.8% | 3.8% | 2.2% | 4.7% | 4.1% |
| FCF Yield | 2.5% | 1.9% | 2.2% | 2.3% | 3.4% | 2.7% | 2.9% | 3.7% | 4.2% | 5.8% | 6.1% |
| Buyback Yield | 0.6% | 0.5% | 0.5% | 0.9% | 1.7% | 1.3% | 1.5% | 1.9% | 1.4% | 2.2% | 3.9% |
| Total Shareholder Yield | 1.5% | 1.1% | 1.2% | 1.7% | 2.6% | 2.1% | 2.4% | 3.2% | 3.0% | 4.4% | 6.6% |
| Shares Outstanding | — | $7.5B | $7.5B | $7.5B | $7.5B | $7.6B | $7.7B | $7.8B | $7.8B | $7.8B | $8.0B |
Compare MSFT with 8 similar companies in its peer group
| Company | Market Cap | P/E | EV/EBITDA | P/FCF | Gross Margin | Op Margin | ROE | ROIC | Debt/EBITDA |
|---|---|---|---|---|---|---|---|---|---|
| MSFTYou | $2.9T | 28.8 | 18.1 | 40.7 | 68.8% | 45.6% | 33.3% | 27.9% | 0.4 |
| ORCL | $408B | 33.5 | 21.0 | — | 70.5% | 30.8% | 82.4% | 12.8% | 4.4 |
| CRWV | $33B | -28.3 | — | — | 71.7% | -0.9% | -79.9% | -0.3% | — |
| NTNX | $10B | 58.9 | 45.2 | 13.8 | 86.8% | 6.8% | — | 688.9% | 6.0 |
| CORZ | $5B | -3.3 | 55.5 | — | 23.7% | -3.8% | — | — | 11.9 |
| DOCN | $5B | 22.2 | 19.1 | 16.6 | 59.9% | 17.4% | — | 15.6% | 2.5 |
| BLZE | $217M | -8.2 | 50.5 | 11.5 | 60.9% | -13.8% | -31.8% | -14.1% | 15.3 |
| DGXX | $180M | -12.5 | 37.1 | — | -30.7% | -29.4% | -26.5% | -32.1% | 0.0 |
| TUYA | $179M | 300.0 | — | 2.7 | 47.4% | -15.9% | 0.5% | -8.5% | — |
| Technology Median | — | 25.2 | 15.7 | 17.3 | 49.8% | -0.9% | 1.1% | 2.9% | 3.0 |
Peers based on L4 peer group classification. Compare multiple stocks →
Includes 30+ ratios · 30 years · Updated daily
Price is only half the story. See total return with reinvested dividends.
Launch CalculatorSee our Bear / Base / Bull DCF models and intrinsic value estimates.
View ValuationSee how MSFT stacks up against sector leader Oracle Corporation.
Start ComparisonMicrosoft Corporation's current P/E ratio is 28.8x. The historical average is 31.2x. This places it at the 47th percentile of its historical range.
Microsoft Corporation's current EV/EBITDA is 18.1x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 20.6x.
Microsoft Corporation's return on equity (ROE) is 33.3%. This is above the typical threshold of 15-20% considered good for most companies. The historical average is 31.9%.
Based on historical data, Microsoft Corporation is trading at a P/E of 28.8x. This is at the 47th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
Microsoft Corporation's current dividend yield is 0.82% with a payout ratio of 23.6%.
Microsoft Corporation has 68.8% gross margin and 45.6% operating margin. Operating margin above 20% indicates strong pricing power and cost efficiency.
Microsoft Corporation's Debt/EBITDA ratio is 0.4x, indicating low leverage. A ratio below 2x is generally considered financially healthy.