Microsoft Corporation (MSFT)
Cash ratio
| Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 30,242,000 | 28,828,000 | 17,482,000 | 20,840,000 | 18,315,000 | 19,634,000 | 17,305,000 | 80,452,000 | 34,704,000 | 26,562,000 | 15,646,000 | 22,884,000 | 13,931,000 | 12,498,000 | 20,604,000 | 19,165,000 | 14,224,000 | 13,702,000 | 14,432,000 | 17,205,000 |
| Short-term investments | US$ in thousands | 64,323,000 | 50,784,000 | 54,069,000 | 57,589,000 | 57,216,000 | 60,379,000 | 63,677,000 | 63,499,000 | 76,552,000 | 77,865,000 | 83,862,000 | 84,378,000 | 90,818,000 | 92,195,000 | 104,765,000 | 111,419,000 | 116,032,000 | 111,705,000 | 117,536,000 | 120,772,000 |
| Total current liabilities | US$ in thousands | 141,218,000 | 114,206,000 | 108,882,000 | 115,200,000 | 125,286,000 | 118,525,000 | 121,016,000 | 124,792,000 | 104,149,000 | 85,691,000 | 81,718,000 | 87,389,000 | 95,082,000 | 77,439,000 | 77,510,000 | 80,528,000 | 88,657,000 | 72,193,000 | 67,486,000 | 70,056,000 |
| Cash ratio | 0.67 | 0.70 | 0.66 | 0.68 | 0.60 | 0.68 | 0.67 | 1.15 | 1.07 | 1.22 | 1.22 | 1.23 | 1.10 | 1.35 | 1.62 | 1.62 | 1.47 | 1.74 | 1.96 | 1.97 |
June 30, 2025 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($30,242,000K
+ $64,323,000K)
÷ $141,218,000K
= 0.67
The analysis of Microsoft Corporation's cash ratio over the specified periods indicates a trend characterized by fluctuations within a generally high range. The cash ratio, which measures the company's ability to cover its current liabilities with its cash and cash equivalents, remained relatively strong from September 30, 2020, through September 30, 2021, oscillating between approximately 1.47 and 1.97. This suggests that during this period, Microsoft maintained a substantial liquidity buffer, with cash and equivalents exceeding its current obligations.
Starting from late 2021, a consistent decline in the cash ratio is observable, with values decreasing from approximately 1.62 at the end of 2021 to around 1.07 by June 2023. This downward trend indicates a gradual reduction in cash holdings relative to current liabilities, potentially reflecting strategic shifts such as increased investments, acquisitions, or dividend payments that may have utilized liquidity reserves.
In the subsequent periods up to September 2024, the cash ratio continued to decline but at a relatively moderate pace, stabilizing around 0.66 to 0.68. This plateau suggests a period of stabilizing liquidity levels, possibly aligning with operational needs or strategic financial management.
By the latest data point in June 2025, the cash ratio slightly increased to approximately 0.67, maintaining a level indicative of sufficient liquidity, though significantly lower than the peak levels observed in 2020 and early 2021. This overall declining pattern highlights a notable reduction in cash and equivalents in relation to current liabilities over the analyzed timeframe, reflecting evolving financial strategies or operational considerations.
In summary, while Microsoft maintained a strong liquidity position during the initial years, there has been a consistent decrease in its cash ratio over recent years, transitioning from a high of nearly 2.0 to around 0.66-0.67, suggesting a strategic shift towards deploying cash into other assets or activities rather than maintaining high cash reserves.
Peer comparison
Jun 30, 2025