Microsoft Credit Rating Analysis: AAA-Rated MSFT & AI Infrastructure Investment Outlook
Executive Summary
Microsoft Credit Rating (Quick Answer)
Microsoft holds AAA credit ratings from all three major agencies:
- S&P Global: AAA (Stable Outlook)
- Moody's: Aaa (Stable Outlook)
- Fitch: AAA (Stable Outlook)
Bankruptcy Risk: Essentially zero (<0.1% probability). Microsoft is one of only two U.S. corporations with perfect AAA/Aaa ratings across all three agencies. And it's hard to imagine a company more deserving of that level of credit confidence.
Microsoft's credit quality is EXCEPTIONAL - representing the gold standard for corporate creditworthiness despite unprecedented AI infrastructure investments. The company holds perfect AAA/Aaa credit ratings from all three major agencies, making it one of only two U.S. corporations (alongside Johnson & Johnson) to maintain this elite status. With $102 billion in cash and investments, $78 billion in annual free cash flow, and interest coverage of 54x, Microsoft can fund its $80+ billion annual AI capex program primarily from operations rather than debt - a stark contrast to peers like CoreWeave and Oracle that rely heavily on debt financing.
| Metric | Value | Signal |
|---|---|---|
| Credit Ratings | AAA/Aaa | Highest Possible |
| Altman Z-Score | 8.98 | Safe Zone |
| Interest Coverage Ratio | 54.4x | Exceptional |
| Current Ratio | 1.30x | Healthy |
| Debt/Equity Ratio | 0.27 | Conservative |
| Net Cash Position | ~$4.4B | Cash Exceeds Debt |
| Free Cash Flow (TTM) | $78.0B | Massive Generation |
| Debt Coverage by OCF | 340% | Fully Covered |
| Bankruptcy Risk | Negligible | <0.1% probability |
Bottom Line: Microsoft represents the benchmark against which all technology credit should be measured. While the company is making the largest capital investment in its 50-year history - spending $80-88 billion in FY2025 and projecting $94+ billion in FY2026 on AI infrastructure - this spending is funded primarily by operating cash flow rather than debt. Microsoft's operating margin of 46%+, combined with its $281.7 billion revenue base and diversified business model, allows the company to pursue transformational AI investments without sacrificing credit quality. For credit investors, Microsoft bonds trading at just 30-50 basis points over Treasuries represent near-risk-free returns with modestly enhanced yield. The key insight: Microsoft proves that massive AI infrastructure investment does not necessarily impair credit quality when backed by sufficient cash generation and disciplined capital allocation.
Company Snapshot
What They Do: Microsoft Corporation is a global technology leader operating across cloud computing (Azure), productivity software (Microsoft 365, Office), operating systems (Windows), gaming (Xbox), professional networking (LinkedIn), and artificial intelligence (Copilot, OpenAI partnership). Founded in 1975, Microsoft has successfully transformed from a PC software company into the world's second-largest cloud infrastructure provider and a leader in enterprise AI deployment.
Why They're on the Radar: Microsoft is making the largest capital investment program in corporate history, spending $80+ billion annually on AI infrastructure and data centers. Unlike peers such as Oracle and CoreWeave whose credit is deteriorating from similar investments, Microsoft's perfect credit ratings remain intact. This analysis examines why Microsoft can absorb massive AI capex without credit impairment - and what lessons this offers for evaluating AI infrastructure credits more broadly. Microsoft also serves as a major customer for AI infrastructure companies including CoreWeave (62-72% of CoreWeave's revenue comes from Microsoft).
Key Stats
- Market Cap: ~$3.0 trillion (December 2025)
- Total Debt: $97.6 billion (September 2025)
- Cash & Investments: $102.0 billion
- Annual Revenue: $281.7 billion (FY2025), growing 15% YoY
- Operating Income: $128.5 billion (FY2025)
- Free Cash Flow: $78.0 billion (TTM)
- Employees: ~228,000 globally
- Founded: 1975 (50-year operating history)
- Cloud Data Centers: 60+ regions globally
The AI Infrastructure Investment
Microsoft's current capital expenditure program represents the largest infrastructure investment in corporate history - yet the company's credit ratings remain at the highest possible level. Understanding how Microsoft can spend $80+ billion annually on AI infrastructure without credit deterioration provides essential context for evaluating the broader AI infrastructure credit landscape.
The transformation began with Microsoft's $13 billion cumulative investment in OpenAI, which gave the company exclusive cloud provider rights for OpenAI's models and early access to GPT technology. This partnership positioned Microsoft to integrate AI across its entire product portfolio - from Azure OpenAI Service to Copilot assistants embedded in Microsoft 365, Windows, and GitHub. The strategy has proven remarkably successful: Azure revenue exceeded $75 billion in FY2025, growing 34% year-over-year, with AI services contributing an estimated 12+ percentage points to that growth.
To meet exploding AI demand, Microsoft embarked on an unprecedented capital expenditure program. Capex surged from $28 billion in FY2023 to $44-50 billion in FY2024 to $80-88 billion in FY2025 - a near-tripling in just two years. Q1 FY2026 alone saw $34.9 billion in capital spending, well above analyst expectations of $30 billion. CFO Amy Hood indicated FY2026 capex growth will exceed FY2025's rate, suggesting spending could reach $94+ billion annually.
The spending breakdown reveals Microsoft's strategic priorities: approximately 50% goes to short-lived assets (GPUs and CPUs from Nvidia and AMD) to power AI workloads, while 50% goes to long-lived assets (data centers, land, infrastructure) that will generate returns for 15+ years. The company is simultaneously expanding globally, with announced investments including $17.5 billion in India, $5.4 billion in Canada, and significant expansions across Europe and Asia. CEO Satya Nadella has stated the goal of doubling Microsoft's data center footprint by 2027.
The Critical Difference from Peers: Unlike CoreWeave (Z-Score 0.66, interest coverage 0.2x) or Oracle (Z-Score 2.49-3.70, negative free cash flow), Microsoft can fund its AI investments primarily from operating cash flow. With $78 billion in annual free cash flow and $102 billion in cash reserves, Microsoft's $80-88 billion capex program creates only modest incremental borrowing needs. The company's debt has increased from $78.8 billion to $97.6 billion over the past year - a manageable rise that still leaves Microsoft in a net cash position.
This dynamic creates an interesting market structure: Microsoft serves as both the largest investor in AI infrastructure AND the largest customer for AI infrastructure companies like CoreWeave. Microsoft's contract with CoreWeave (representing 62-72% of CoreWeave's revenue) effectively makes Microsoft the credit backstop for CoreWeave's business model. If Microsoft's AI demand persists, CoreWeave benefits; if Microsoft decides to build more internal capacity, CoreWeave faces existential risk. See our CoreWeave bankruptcy risk analysis for detailed examination of this customer concentration risk.
The contrast in credit outcomes is striking. Both Microsoft and Oracle are spending aggressively on AI infrastructure. But Microsoft's operating margin of 46%+ generates sufficient cash to self-fund, while Oracle's 43-44% margin (on a much smaller revenue base) forces reliance on debt markets. Microsoft emerges from the AI investment cycle with unchanged credit quality; Oracle faces potential downgrades and multi-year credit deterioration.
Microsoft Credit Rating & Quantitative Assessment
Microsoft's AAA Credit Ratings
Microsoft holds the highest possible credit ratings from all three major rating agencies:
- S&P Global: AAA (Stable Outlook)
- Moody's: Aaa (Stable Outlook)
- Fitch: AAA (Stable Outlook)
Microsoft is one of only two U.S. corporations to maintain perfect AAA/Aaa ratings - the other being Johnson & Johnson. For context, the U.S. federal government itself has been downgraded: S&P cut the U.S. to AA+ in 2011, Fitch followed in 2023, and Moody's moved to negative outlook in 2023. A February 2025 analysis from DoubleLine noted that 30-year Microsoft bonds yield just 49 basis points above comparable Treasuries - "not just a testament to Microsoft's solid credit health but also a potential win-win scenario for those who appreciate an opportunity to both enhance safety and earn a bit of extra juice in income."
Microsoft's Altman Z-Score: Safe Zone Assessment
Microsoft's Altman Z-Score of approximately 8.98 places it firmly in the safe zone (>2.99). The calculation breakdown:
| Component | Ratio | Weight × Value = Score |
|---|---|---|
| Working Capital / Total Assets | $35B / $512B = 0.068 | 1.2 × 0.068 = 0.082 |
| Retained Earnings / Total Assets | $115B / $512B = 0.225 | 1.4 × 0.225 = 0.315 |
| EBIT / Total Assets | $128.5B / $512B = 0.251 | 3.3 × 0.251 = 0.828 |
| Market Value Equity / Total Liabilities | $3,000B / $250B = 12.0 | 0.6 × 12.0 = 7.200 |
| Sales / Total Assets | $281.7B / $512B = 0.550 | 1.0 × 0.550 = 0.550 |
| Total Z-Score | ≈8.98 (Safe Zone >2.99) |
For comparison across the credit spectrum: CoreWeave's Z-Score of 0.66 indicates deep distress, Coherent Corp's 1.75 signals moderate distress, Oracle's 2.49-3.70 represents the grey zone, and IREN's 7.84 indicates very low credit risk. Microsoft sits alongside IREN in the safe zone, demonstrating that technology companies can maintain excellent credit quality even during aggressive investment cycles.
Microsoft's Liquidity & Cash Position
Current Ratio: ~1.30x
- Cash & Short-Term Investments: $102.0 billion
- Total Current Assets: Approximately $150 billion
- Current Liabilities: Approximately $115 billion
- Assessment: Healthy liquidity with substantial cash cushion. Microsoft could operate for years without external financing if necessary.
Cash Position Strength:
- Cash & Marketable Securities: $102.0 billion
- EBITDA (estimated): ~$135.9 billion annually
- Free Cash Flow: $78.0 billion TTM
- Assessment: Microsoft generates approximately $6.5 billion in free cash flow per month. Even $90 billion annual capex leaves substantial cash generation after investment.
Microsoft's Debt & Leverage Metrics
Debt Position:
- Total Debt (Sep 2025): $97.6 billion
- Long-Term Debt: $35.4 billion (declining 17.5% YoY)
- Cash & Investments: $102.0 billion
- Net Debt: Approximately -$4.4 billion (NET CASH POSITION)
- Debt/Equity: 0.27 (declined from 0.62 in 2020)
- Debt/Capital: 0.21
- Debt/Assets: 0.14
Interest Coverage:
- Q1 FY2026 Operating Income: $38.0 billion
- Q1 FY2026 Interest Expense: $698 million
- Quarterly Interest Coverage: 54.4x
- Annual Interest Expense: ~$2.4 billion
- Annual Operating Income: ~$128.5 billion
- Assessment: Microsoft generates $54 of operating income for every $1 of interest expense. This is among the highest interest coverage ratios of any large corporation globally.
For context on interest coverage across the credit spectrum:
| Company | Interest Coverage | Credit Quality |
|---|---|---|
| Microsoft | 54.4x | AAA/Aaa |
| IREN | 18-22x | Low Risk |
| Oracle | 6.2x | BBB (Deteriorating) |
| Coherent | ~3-4x | BB/B1 |
| CoreWeave | 0.2x | Distressed |
Free Cash Flow Analysis
Microsoft's free cash flow generation distinguishes it from AI infrastructure peers:
| Period | Operating Cash Flow | Capital Expenditures | Free Cash Flow |
|---|---|---|---|
| FY2023 | ~$87.6B | ~$28.1B | +$59.5B |
| FY2024 | ~$118.5B | ~$44.5B | +$74.1B |
| FY2025 | ~$159.5B | ~$88.2B | +$71.6B |
| TTM (Sep 2025) | ~$156B | ~$78B | +$78.0B |
| FY2026 Projected | ~$170B+ | $94B+ | +$70-80B |
Critical Insight: Despite nearly tripling capital expenditures from $28 billion to $88 billion over three years, Microsoft continues to generate $70+ billion in annual free cash flow. This is the fundamental difference from Oracle (negative $5.1 billion FCF, projected negative $25-38 billion by FY2028) and CoreWeave (negative $6.95 billion levered FCF). Microsoft's massive operating cash flow generation means AI investments strengthen rather than weaken the business.
CDS Spread Estimate
While specific Microsoft CDS data requires institutional access, bond market pricing provides insight:
- 30-year Microsoft bonds: 49 bps over Treasuries (February 2025)
- Implied 5-year CDS spread: Estimated 20-35 bps
- Comparison: U.S. Government 5-year CDS traded at ~70 bps (April 2025)
Microsoft's credit spreads are tighter than many sovereign nations, reflecting the market's view that Microsoft debt is essentially risk-free.
Qualitative Credit Strengths
Business Model Diversification
Microsoft's revenue diversification provides exceptional stability:
- Intelligent Cloud (Azure, Server Products): $30.9 billion quarterly, +28% YoY - 40% of revenue
- Productivity & Business Processes (Office, LinkedIn, Dynamics): $33.0 billion quarterly, +17% YoY - 42% of revenue
- More Personal Computing (Windows, Gaming, Devices): $13.8 billion quarterly, +4% YoY - 18% of revenue
No single product or customer represents more than 10% of revenue. This diversification contrasts sharply with CoreWeave, where Microsoft itself represents 62-72% of revenue - an extreme customer concentration risk.
Recurring Revenue Model
Microsoft's subscription-based business model provides exceptional revenue visibility:
- Microsoft 365 Subscribers: 400+ million commercial seats
- Azure Contracts: Multi-year enterprise agreements with annual commitments
- Remaining Performance Obligations: Growing rapidly (exact figure not disclosed but estimated at $200+ billion)
- Revenue Retention: 95%+ net revenue retention in enterprise segments
Competitive Position
Microsoft maintains dominant or leading positions across key markets:
- Cloud Infrastructure: #2 globally (Azure ~23% market share, behind AWS at ~32%)
- Productivity Software: #1 globally (Office/M365 dominant with 80%+ enterprise market share)
- Operating Systems: #1 in enterprise (Windows 70%+ market share)
- Enterprise AI: Leading position through OpenAI partnership and Copilot integration
- Gaming: #3 globally (strengthened by Activision Blizzard acquisition)
Management Quality
CEO Satya Nadella's tenure since 2014 has been transformational:
- Market cap growth from $300 billion to $3+ trillion
- Successful pivot from Windows-centric to cloud-first strategy
- Disciplined capital allocation balancing growth investment, dividends, and buybacks
- Strategic OpenAI partnership executed before AI boom
- Conservative financial policies maintaining AAA rating through major acquisitions (LinkedIn, Activision)
OpenAI Partnership & AI Leadership
Microsoft's $13 billion cumulative investment in OpenAI provides significant strategic advantages:
- Exclusive Cloud Provider: All OpenAI training and inference runs on Azure
- Technology Access: Early and exclusive access to GPT models for Microsoft products
- Revenue Share: Percentage of OpenAI revenue until investment recovered
- Competitive Moat: Azure OpenAI Service differentiates from AWS and Google Cloud
Scenario Analysis
Base Case: Continued Excellence (85% Probability)
Key Assumptions:
- Azure growth sustains 30-40% annually through FY2028
- AI Copilot products achieve meaningful monetization ($10B+ annual revenue by FY2027)
- Capex peaks at $100-110 billion in FY2027, then moderates
- Operating margins sustain 44-46% despite AI investment costs
- Free cash flow remains positive at $60-80 billion annually
Credit Outcomes:
- AAA/Aaa ratings maintained throughout investment cycle
- Net cash position preserved or modestly leveraged (0.5-1.0x net debt/EBITDA maximum)
- Interest coverage remains above 40x
- CDS spreads stable at 25-40 bps
- Dividend growth continues at 10%+ annually
Bankruptcy Risk: Less than 0.1% (negligible)
Bull Case: AI Dominance Accelerates (10% Probability)
What Would Need to Happen:
- Azure captures significant market share from AWS (reaching 30%+ cloud market share)
- Copilot becomes standard enterprise tool with $25B+ annual revenue by FY2028
- OpenAI partnership generates substantial profit-sharing returns
- Operating margins expand to 48-50% through AI efficiency gains
Credit Outcomes:
- Free cash flow exceeds $100 billion annually by FY2028
- Net cash position expands to $50+ billion despite capex
- Microsoft bonds trade at or below Treasury yields
- Potential for credit rating agencies to consider "super-AAA" category
Bankruptcy Risk: 0% (impossible)
Bear Case: AI Investment Disappoints (5% Probability)
Key Assumptions:
- AI demand growth slows dramatically as enterprise adoption disappoints
- Azure growth decelerates to 15-20% as hyperscaler competition intensifies
- Capex continues at $80B+ annually without corresponding revenue acceleration
- Operating margins compress to 38-40%
- OpenAI faces competitive pressure from open-source alternatives
Credit Outcomes:
- Free cash flow declines to $40-50 billion annually
- Net debt position reaches 1.0-1.5x EBITDA
- Potential for rating outlook change to negative (but actual downgrade highly unlikely)
- CDS spreads widen to 50-75 bps
- Dividend growth slows but continues
Bankruptcy Risk: Less than 0.5% even in bear case - Microsoft's diversified revenue base, existing cash position, and ability to reduce capex provide multiple layers of protection.
Frequently Asked Questions
What is Microsoft's credit rating?
Microsoft holds the highest possible credit ratings: AAA from S&P and Fitch, and Aaa from Moody's, all with stable outlooks. Microsoft is one of only two U.S. companies (alongside Johnson & Johnson) to maintain perfect AAA/Aaa ratings. For comparison, the U.S. government has been downgraded to AA+ by S&P and Fitch.
What is Microsoft's bankruptcy risk?
Microsoft's bankruptcy risk is essentially zero. With $102 billion in cash and investments, $78 billion in annual free cash flow, interest coverage of 54x, and perfect AAA credit ratings, Microsoft represents the gold standard for corporate credit quality. The company maintains a net cash position despite $97.6 billion in total debt. Probability of bankruptcy is less than 0.1%.
How much debt does Microsoft have?
Microsoft has approximately $97.6 billion in total debt as of September 2025. However, with $102 billion in cash and short-term investments, Microsoft maintains a net cash position of approximately $4.4 billion. The debt-to-equity ratio is just 0.27 (down from 0.62 in 2020), and debt is covered 340% by operating cash flow.
How much is Microsoft spending on AI infrastructure?
Microsoft spent $80-88 billion on capital expenditures in fiscal year 2025, primarily for AI infrastructure and data centers. Q1 FY2026 capex was $34.9 billion (a record), and FY2026 is projected to exceed $94 billion. Approximately 50% goes to GPUs/CPUs and 50% to long-lived data center assets. The company aims to double its data center footprint by 2027.
What is Microsoft's interest coverage ratio?
Microsoft's interest coverage ratio is approximately 54x, meaning the company generates $54 of operating income for every $1 of interest expense. This is exceptionally strong compared to distressed credits like CoreWeave (0.2x) and even healthy companies like Oracle (6.2x). Learn more about interest coverage ratios in our credit risk guide.
How does Microsoft compare to Oracle and CoreWeave in credit quality?
Microsoft represents the opposite end of the credit spectrum from CoreWeave:
- Microsoft: AAA ratings, 54x interest coverage, net cash position, Z-Score 8.98
- Oracle: BBB ratings, 6.2x interest coverage, 4x net debt/EBITDA, Z-Score 2.49-3.70
- CoreWeave: B/BB ratings, 0.2x interest coverage, extreme leverage, Z-Score 0.66
All three are investing heavily in AI infrastructure, but only Microsoft can fund investments from cash flow without credit deterioration.
Why is Microsoft's credit rating AAA despite massive AI spending?
Microsoft maintains AAA ratings despite $80B+ annual AI capex because of its massive cash generation ($78B free cash flow annually), $102B cash reserves, diversified revenue streams ($281.7B annual revenue), and strong profitability (46%+ operating margins). Unlike CoreWeave or Oracle, Microsoft can fund AI investments primarily from operating cash flow rather than debt.
Is Microsoft AAA rated?
Yes, Microsoft is AAA rated by all three major credit rating agencies: S&P Global (AAA), Moody's (Aaa), and Fitch (AAA), all with stable outlooks. Microsoft is one of only two U.S. corporations to hold perfect AAA/Aaa ratings across all three agencies. The other is Johnson & Johnson.
Does Microsoft have good credit?
Microsoft has exceptional credit quality with the highest possible AAA credit ratings, $102 billion in cash, $78 billion annual free cash flow, 54x interest coverage ratio, and a net cash position. Microsoft's credit is considered stronger than the U.S. government, which has been downgraded to AA+ by S&P and Fitch.
What is MSFT's debt rating?
MSFT (Microsoft Corporation) has the highest possible debt ratings: AAA from S&P Global and Fitch Ratings, and Aaa from Moody's Investors Service. These perfect ratings indicate the lowest credit risk and highest ability to meet financial obligations.
What to Watch
Key Metrics to Monitor Quarterly
- Azure Revenue Growth: Currently 40% YoY. Watch for sustained 30%+ growth indicating AI demand strength. Red flag if growth decelerates below 25%.
- Operating Margin: Currently 46-49%. Watch for margin stability despite AI infrastructure costs. Red flag if margins compress below 42%.
- Free Cash Flow: Currently $78B TTM. Watch for FCF remaining positive despite capex surge. Red flag if FCF falls below $50B annually.
- Capital Expenditure Trajectory: Currently $34.9B quarterly. Watch for capex efficiency and returns on AI investments. Red flag if capex exceeds $40B quarterly without revenue acceleration.
- Net Debt Position: Currently net cash ~$4.4B. Watch for preservation of net cash or minimal leverage. Red flag if net debt exceeds 1.0x EBITDA.
- Credit Spreads: Currently 30-50 bps over Treasuries. Watch for spread stability. Red flag if spreads widen above 75 bps.
Upcoming Key Dates
- Q2 FY2026 Earnings: Late January 2026 - Test of Azure growth sustainability
- Q3 FY2026 Earnings: Late April 2026 - Copilot monetization progress
- FY2027 Guidance: July 2026 - Critical update on capex trajectory
- Annual Credit Reviews: Ongoing - Rating agency assessments of AI investment strategy
Information Sources
- SEC Filings: 10-Q quarterly reports, 10-K annual report, 8-K material events
- Microsoft Investor Relations: microsoft.com/investor
- Earnings Calls: Quarterly conference calls with management commentary
- Credit Rating Reports: S&P, Moody's, Fitch research (subscription required)
Conclusion
Microsoft Corporation represents the gold standard for corporate credit quality - demonstrating that massive AI infrastructure investment does not necessarily impair creditworthiness when backed by sufficient cash generation and disciplined capital allocation.
Key Takeaways
- Perfect Credit Ratings Justified: Microsoft's AAA/Aaa ratings reflect genuine financial strength - $102 billion in cash, $78 billion in annual free cash flow, 54x interest coverage, and net cash position despite $97.6 billion in debt. These are not legacy ratings based on historical reputation; they reflect current financial reality.
- AI Capex Funded from Operations: Unlike Oracle (negative FCF, rising leverage) and CoreWeave (existential refinancing risk), Microsoft can fund $80+ billion annual AI capex primarily from operating cash flow. This is the critical difference that preserves credit quality.
- Diversification Provides Resilience: With $281.7 billion in annual revenue across cloud, productivity software, gaming, and devices, Microsoft faces no customer concentration or single-product dependency. If AI investments disappoint, the core business remains highly profitable.
- Microsoft as AI Infrastructure Backstop: As CoreWeave's largest customer (62-72% of revenue), Microsoft effectively serves as credit backstop for the AI infrastructure ecosystem. CoreWeave's survival depends on Microsoft continuing to rent rather than build GPU capacity.
- Benchmark for AI Infrastructure Credit Analysis: Microsoft proves that the determining factor for AI infrastructure credit quality is not the amount of investment, but the ability to fund that investment from operations. Companies relying on debt markets for AI capex face fundamental credit risk; companies funding from cash flow do not.
Credit Assessment: EXCEPTIONAL - near-zero bankruptcy risk over any reasonable time horizon. Microsoft bonds trading at 30-50 bps over Treasuries represent essentially risk-free fixed income with modestly enhanced yield. The company's willingness to invest $80+ billion annually in AI infrastructure, funded primarily from operations, positions Microsoft for continued dominance in enterprise technology while maintaining the financial fortress that justifies its elite credit status.
For credit investors seeking exposure to AI infrastructure growth without the credit deterioration risk facing peers like Oracle or the distress signals present at CoreWeave, Microsoft offers a compelling risk-return profile. The question is not whether Microsoft can maintain its credit quality, but whether 30-50 bps of spread adequately compensates for giving up Treasury liquidity. For most investors, the answer is yes.
Methodology & Disclaimers
Data Sources: Microsoft SEC filings (10-K, 10-Q, 8-K), company earnings materials and investor presentations, credit rating agency reports (Moody's, S&P, Fitch), financial data providers (Yahoo Finance, MacroTrends, GuruFocus), news sources (CNBC, Bloomberg).
Last Filing Reviewed: Q1 FY2026 earnings (October 29, 2025)
Calculations: Interest coverage, debt ratios, and other metrics calculated from publicly available financial statements. Altman Z-Score calculated using the standard formula: Z = 1.2(WC/TA) + 1.4(RE/TA) + 3.3(EBIT/TA) + 0.6(MVE/TL) + 1.0(S/TA).
Limitations: This analysis represents a point-in-time assessment based on publicly available information. While Microsoft's credit quality appears exceptional, unforeseen events could impact financial performance. This is educational content for informational purposes and does not constitute investment advice.
Update Schedule: This analysis will be updated following quarterly earnings releases or material developments.
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