Microsoft Corporation (MSFT)

Debt-to-equity ratio

		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	Sep 30, 2019
Long-term debt	US$ in thousands	42,868,000	42,658,000	44,928,000	41,946,000	41,990,000	41,965,000	44,119,000	45,374,000	47,032,000	48,177,000	48,260,000	50,039,000	50,074,000	50,007,000	55,136,000	57,055,000	59,578,000	62,862,000	63,361,000	66,478,000
Total stockholders’ equity	US$ in thousands	287,723,000	253,152,000	238,268,000	220,714,000	206,223,000	194,683,000	183,136,000	173,566,000	166,542,000	162,924,000	160,010,000	151,978,000	141,988,000	134,505,000	130,236,000	123,392,000	118,304,000	114,501,000	110,109,000	106,061,000
Debt-to-equity ratio		0.15	0.17	0.19	0.19	0.20	0.22	0.24	0.26	0.28	0.30	0.30	0.33	0.35	0.37	0.42	0.46	0.50	0.55	0.58	0.63

September 30, 2024 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $42,868,000K ÷ $287,723,000K
= 0.15

The debt-to-equity ratio of Microsoft Corporation has been showing a decreasing trend over the past few years, indicating a decreasing reliance on debt funding compared to equity. The ratio was 0.15 as of September 30, 2024, which means that for every dollar of equity, the company had $0.15 of debt. This demonstrates a strong financial position with a lower level of debt relative to equity.

The ratio has gradually decreased from 0.63 in September 2019 to 0.15 in September 2024, showing a consistent effort by the company to reduce its debt levels and strengthen its balance sheet. A lower debt-to-equity ratio suggests a lower financial risk and a higher capacity for the company to meet its financial obligations.

Microsoft's decreasing debt-to-equity ratio can be seen as a positive trend, indicating prudent financial management and a focus on maintaining a healthy capital structure. It suggests that the company has been able to efficiently manage its finances by reducing its reliance on external debt financing.

Overall, the decreasing trend in Microsoft's debt-to-equity ratio reflects a favorable financial position and a well-managed capital structure, which bodes well for the company's long-term financial stability and growth prospects.