The above graph represents Microsoft net income by year, starting from fiscal 1990 to 2020. The annual net profit of Microsoft reached an all-time high of $44,281 million during the fiscal year ended June 30, 2020. That’s an impressive 12.8% YoY growth. Over 25.3% of that company generated in the fourth quarter alone.
Microsoft Annual Net Income: History
|Source||Microsoft Annual reports, SEC Filings|
|Note||Microsoft financial year – from July 1 to June 30|
It was the first time in fiscal 2005 when the net income of Microsoft crossed $10 billion mark. The company recorded a whopping 50% YoY increase in its net income, amounting to $12,254 million ($12.3 billion). Over 30% of that or $3,700 million to be specific, the company generated in the fourth quarter.
In fiscal 2018, Microsoft posted a total net income of $16,571 million ($16.6 billion). Surprisingly, that’s a huge 35% decline from the previous year when the company’s net profit soared to 24% YoY to $25,489 million ($25.5 billion). The YoY decrease in 2018 net income was due to the loss of $6.3 billion ($6,302 million) in Q2 2018, reflecting a $13.8 billion tax payment related to Microsoft profits held overseas.
Microsoft net income in fiscal 2019 increased a whopping 136.8% YoY to $39,240 million. The company’s FY19 total net income includes a $2.6 billion net income tax benefit related to intangible property transfers and a $157 million net charge related to the enactment of the Tax Cuts and Jobs Act (“TCJA”), which together increased net income and diluted earnings per share (“EPS”) by $2.4 billion and $0.31, respectively.
About Microsoft: Additional Information
Microsoft Corporation (NASDAQ: MSFT) is an American multinational technology company, founded by Bill Gates and Paul Allen on April 4, 1975. The company is best known for its software products such as Microsoft Windows OSs, Microsoft Office Suite, and web browsers such as Internet Explorer and Microsoft Edge.
Microsoft rose to dominate the personal computer operating system market during the 1980-81 when it formed a partnership with IBM to provide MS-DOS (Microsoft Disk Operating System) for IBM PCs. This implied that for every computer sold by IBM having Microsoft’s OS, a royalty was paid to Microsoft.
On November 20, 1985, Microsoft launched Windows – a graphical operating environment that runs on MS-DOS.
On March 13, 1986, Microsoft had a highly successful initial public offering (IPO) for $21 per share. By the end of the day, the stock price had risen to $35.50, which made Bill Gates an instant multi-millionaire, with 44.8% of the company’s stock.
On May 22, 1990, Microsoft launched Windows 3.0. Interestingly, Microsoft’s Windows 3.0 became the first widely successful version of Windows, from the very first day.
Microsoft has made ten acquisitions worth over one billion dollars: Skype (2011), aQuantive (2007), Fast Search & Transfer (2008), Navision (2002), Visio Corporation (2000), Yammer (2012), Nokia’s mobile and devices division (2013), Mojang (2014), LinkedIn (2016) and GitHub (2018).
Microsoft recently overtook Apple to become the world’s most valuable company, clocking $1 trillion valuation.
Here are some more interesting facts about Microsoft.
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