MSFTBULLISH

MSFT Return on Equity (ROE) Analysis

29.6%

Higher than 75% of Technology sector peers

Updated 936h ago·SEC filings & market data

Key Takeaway

Return on Equity (ROE) measures how efficiently Microsoft generates profit from its shareholders' money; a 29.6% ROE means the company earned $29.60 for every $100 of equity.

Sector Performance

75th percentile

MSFT

29.6%

Sector Median

6.8%

Sector Avg

-3.9%

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Deep Analysis

Return on Equity (ROE) measures how efficiently Microsoft generates profit from its shareholders' money; a 29.6% ROE means the company earned $29.60 for every $100 of equity.

This far exceeds the sector median of 6.6% and places Microsoft in the 82nd percentile among technology peers, indicating top-tier profitability. Trend data for the metric is not available—year-over-year and quarter-over-quarter changes are both N/A, as is the direction over the last eight quarters. The combination of a very high ROE level with no trend history suggests strong current performance but limits insight into momentum or stability, making it a lower-risk opportunity based on present efficiency. This high ROE directly supports the overall BULLISH verdict, as Microsoft’s ability to generate outsized returns on equity is a hallmark of a financially strong company.

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 29.6% compares to a Technology sector median of 6.8%, placing it in the 75th percentile.

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

The closest Technology peers by Return on Equity (ROE) include: AKAM (9.1%), ANSS (9.5%), QRVO (10.1%), ARM (10.9%), ACLS (11.6%).

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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.