Microsoft Corp., adjustment to net income

US$ in millions

12 months ended:	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020	Jun 30, 2019
Net income (as reported)	88,136)	72,361)	72,738)	61,271)	44,281)	39,240)
Add: Net change related to investments	957)	(1,444)	(5,360)	(2,266)	3,990)	2,405)
Net income (adjusted)	89,093)	70,917)	67,378)	59,005)	48,271)	41,645)

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Microsoft Corp., adjusted profitability ratios

	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020	Jun 30, 2019
Net Profit Margin
Reported net profit margin	35.96%	34.15%	36.69%	36.45%	30.96%	31.18%
Adjusted net profit margin	36.35%	33.46%	33.98%	35.10%	33.75%	33.09%
Return on Equity (ROE)
Reported ROE	32.83%	35.09%	43.68%	43.15%	37.43%	38.35%
Adjusted ROE	33.18%	34.39%	40.46%	41.56%	40.80%	40.70%
Return on Assets (ROA)
Reported ROA	17.21%	17.56%	19.94%	18.36%	14.70%	13.69%
Adjusted ROA	17.40%	17.21%	18.47%	17.68%	16.02%	14.53%

Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Microsoft Corp. adjusted net profit margin ratio deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level.
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by shareholders’ equity.	Microsoft Corp. adjusted ROE deteriorated from 2022 to 2023 and from 2023 to 2024.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by total assets.	Microsoft Corp. adjusted ROA deteriorated from 2022 to 2023 but then slightly improved from 2023 to 2024.

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	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020	Jun 30, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income	88,136)	72,361)	72,738)	61,271)	44,281)	39,240)
Revenue	245,122)	211,915)	198,270)	168,088)	143,015)	125,843)
Profitability Ratio
Net profit margin¹	35.96%	34.15%	36.69%	36.45%	30.96%	31.18%
Adjusted: Mark to Market Available-for-sale Securities
Selected Financial Data (US$ in millions)
Adjusted net income	89,093)	70,917)	67,378)	59,005)	48,271)	41,645)
Revenue	245,122)	211,915)	198,270)	168,088)	143,015)	125,843)
Profitability Ratio
Adjusted net profit margin²	36.35%	33.46%	33.98%	35.10%	33.75%	33.09%

2024 Calculations

¹ Net profit margin = 100 × Net income ÷ Revenue
= 100 × 88,136 ÷ 245,122 = 35.96%

² Adjusted net profit margin = 100 × Adjusted net income ÷ Revenue
= 100 × 89,093 ÷ 245,122 = 36.35%

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Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Microsoft Corp. adjusted net profit margin ratio deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level.

	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020	Jun 30, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income	88,136)	72,361)	72,738)	61,271)	44,281)	39,240)
Stockholders’ equity	268,477)	206,223)	166,542)	141,988)	118,304)	102,330)
Profitability Ratio
ROE¹	32.83%	35.09%	43.68%	43.15%	37.43%	38.35%
Adjusted: Mark to Market Available-for-sale Securities
Selected Financial Data (US$ in millions)
Adjusted net income	89,093)	70,917)	67,378)	59,005)	48,271)	41,645)
Stockholders’ equity	268,477)	206,223)	166,542)	141,988)	118,304)	102,330)
Profitability Ratio
Adjusted ROE²	33.18%	34.39%	40.46%	41.56%	40.80%	40.70%

2024 Calculations

¹ ROE = 100 × Net income ÷ Stockholders’ equity
= 100 × 88,136 ÷ 268,477 = 32.83%

² Adjusted ROE = 100 × Adjusted net income ÷ Stockholders’ equity
= 100 × 89,093 ÷ 268,477 = 33.18%

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Profitability ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by shareholders’ equity.	Microsoft Corp. adjusted ROE deteriorated from 2022 to 2023 and from 2023 to 2024.

	Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020	Jun 30, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income	88,136)	72,361)	72,738)	61,271)	44,281)	39,240)
Total assets	512,163)	411,976)	364,840)	333,779)	301,311)	286,556)
Profitability Ratio
ROA¹	17.21%	17.56%	19.94%	18.36%	14.70%	13.69%
Adjusted: Mark to Market Available-for-sale Securities
Selected Financial Data (US$ in millions)
Adjusted net income	89,093)	70,917)	67,378)	59,005)	48,271)	41,645)
Total assets	512,163)	411,976)	364,840)	333,779)	301,311)	286,556)
Profitability Ratio
Adjusted ROA²	17.40%	17.21%	18.47%	17.68%	16.02%	14.53%

2024 Calculations

¹ ROA = 100 × Net income ÷ Total assets
= 100 × 88,136 ÷ 512,163 = 17.21%

² Adjusted ROA = 100 × Adjusted net income ÷ Total assets
= 100 × 89,093 ÷ 512,163 = 17.40%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by total assets.	Microsoft Corp. adjusted ROA deteriorated from 2022 to 2023 but then slightly improved from 2023 to 2024.

Microsoft Corp. (NASDAQ:MSFT)

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