Microsoft Corporation (MSFT)

Current ratio

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Total current assets	US$ in thousands	159,734,000	184,257,000	169,684,000	184,406,000	181,915,000
Total current liabilities	US$ in thousands	125,286,000	104,149,000	95,082,000	88,657,000	72,310,000
Current ratio		1.27	1.77	1.78	2.08	2.52

June 30, 2024 calculation

Current ratio = Total current assets ÷ Total current liabilities
= $159,734,000K ÷ $125,286,000K
= 1.27

The current ratio of Microsoft Corporation has shown a decreasing trend over the past five years, declining from 2.52 in June 30, 2020, to 1.27 in June 30, 2024. This indicates that the company's ability to meet its short-term obligations with its current assets has weakened over this period. While a current ratio above 1.0 typically suggests that the company can cover its current liabilities with its current assets, the decreasing trend raises some concern about Microsoft's liquidity position and its ability to comfortably meet its short-term obligations in the near future. Further analysis of the company's liquidity management and working capital strategies may be warranted to address this deteriorating trend in the current ratio.