MSFTBULLISH

MSFT Return on Equity (ROE) Analysis

34.0%

Higher than 70% of Technology sector peers

Updated 924h ago·SEC filings & market data

Key Takeaway

A 34.0% Return on Equity (ROE) means Microsoft generates $0.34 of profit for every $1 of shareholders' equity, showing it uses investor capital efficiently.

Sector Performance

70th percentile

MSFT

34.0%

Sector Median

9.1%

Sector Avg

-3.2%

Prior Period

29.6%(Jun 2026)

↑ Improving

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Deep Analysis

A 34.0% Return on Equity (ROE) means Microsoft generates $0.34 of profit for every $1 of shareholders' equity, showing it uses investor capital efficiently.

That level sits well above the sector median of 8.2%, placing Microsoft in the 74th percentile of technology peers. However, the trend is not available: the year-over-year change is N/A and the quarter-over-quarter change is N/A, so no direction can be inferred from recent movement. The high ROE combined with missing trend data suggests strong current profitability but leaves momentum unverified, which tempers the opportunity with some uncertainty about persistence. This metric supports the overall BULLISH verdict directly because Microsoft's profit efficiency far exceeds most competitors, even without trend confirmation.

Frequently Asked Questions

What does the Return on Equity (ROE) tell investors about MSFT?

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.

How is the Return on Equity (ROE) calculated?

Return on Equity (ROE) is calculated as: Net Income / Shareholders' Equity.

How does MSFT's Return on Equity (ROE) compare to its sector?

MSFT's Return on Equity (ROE) of 34.0% compares to a Technology sector median of 9.1%, placing it in the 70th percentile.

Who are MSFT's closest peers by Return on Equity (ROE)?

The closest Technology peers by Return on Equity (ROE) include: AFRM (1.7%), SQ (0.0%), CRWD (-0.2%), MDB (-1.0%), APLD (-5.6%).

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Learn More About Return on Equity (ROE)

What Is Return on Equity (ROE) and Is Higher Always Better?

Return on equity ROE measures how efficiently a company generates profit from shareholder capital. Learn how to decompose ROE using DuPont analysis and why high leverage can make it dangerous—with Apple and JPMorgan examples.

The Formula

Net Income / Shareholders' Equity

Why It Matters

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.