Microsoft Corporation (MSFT)

Fixed asset turnover

		Dec 31, 2024	Sep 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019
Revenue (ttm)	US$ in thousands	256,603,000	243,277,000	233,448,000	224,942,000	216,125,000	209,732,000	205,479,000	201,806,000	201,002,000	196,109,000	190,298,000	182,625,000	173,955,000	165,936,000	158,374,000	151,630,000	145,394,000	141,098,000	136,782,000	132,460,000
Property, plant and equipment	US$ in thousands	166,902,000	152,863,000	121,375,000	112,308,000	102,502,000	95,641,000	88,132,000	82,755,000	77,037,000	74,398,000	70,298,000	67,214,000	63,772,000	59,715,000	54,945,000	51,737,000	47,927,000	44,151,000	41,221,000	40,522,000
Fixed asset turnover		1.54	1.59	1.92	2.00	2.11	2.19	2.33	2.44	2.61	2.64	2.71	2.72	2.73	2.78	2.88	2.93	3.03	3.20	3.32	3.27

December 31, 2024 calculation

Fixed asset turnover = Revenue (ttm) ÷ Property, plant and equipment
= $256,603,000K ÷ $166,902,000K
= 1.54

The fixed asset turnover ratio shows how efficiently a company utilizes its fixed assets to generate sales revenue. For Microsoft Corporation, the fixed asset turnover has been gradually declining over the years from a high of 3.32 in March 2020 to 1.54 as of December 31, 2024. This indicates that Microsoft is generating fewer revenues relative to its investment in fixed assets.

A decreasing fixed asset turnover ratio may suggest that Microsoft's fixed assets are not being utilized effectively to generate sales. This could be due to factors such as underutilization of assets, technological advancements reducing the value of existing assets, or inefficient management of fixed assets. It is important for Microsoft to address this trend and evaluate the efficiency of its asset management strategies to improve the utilization of fixed assets and enhance overall profitability.