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MSFT

9/9 Score

Microsoft Corporation

Analysis Date: February 21, 2026

Microsoft Corporation develops, licenses, and supports software, services, devices, and solutions worldwide. The company operates in three segments: Productivity and Business Processes, Intelligent Cloud, and More Personal Computing. The Productivity and Business Processes segment offers Office, Exchange, SharePoint, Microsoft Teams, Office 365 Security and Compliance, Microsoft Viva, and Skype for Business; Skype, Outlook.com, OneDrive, and LinkedIn; and Dynamics 365, a set of cloud-based and on-premises business solutions for organizations and enterprise divisions. The Intelligent Cloud segment licenses SQL, Windows Servers, Visual Studio, System Center, and related Client Access Licenses; GitHub that provides a collaboration platform and code hosting service for developers; Nuance provides healthcare and enterprise AI solutions; and Azure, a cloud platform. It also offers enterprise support, Microsoft consulting, and nuance professional services to assist customers in developing, deploying, and managing Microsoft server and desktop solutions; and training and certification on Microsoft products. The More Personal Computing segment provides Windows original equipment manufacturer (OEM) licensing and other non-volume licensing of the Windows operating system; Windows Commercial, such as volume licensing of the Windows operating system, Windows cloud services, and other Windows commercial offerings; patent licensing; and Windows Internet of Things. It also offers Surface, PC accessories, PCs, tablets, gaming and entertainment consoles, and other devices; Gaming, including Xbox hardware, and Xbox content and services; video games and third-party video game royalties; and Search, including Bing and Microsoft advertising. The company sells its products through OEMs, distributors, and resellers; and directly through digital marketplaces, online stores, and retail stores. Microsoft Corporation was founded in 1975 and is headquartered in Redmond, Washington.

Buffettology Criteria

All 9 of 9 criteria passed

  • High ROE

    Return on Equity > 12%

    Value: 33.6%

  • High ROIC

    Return on Invested Capital > 9%

    Value: 21.5%

  • Cash Machine

    FCF / Assets > 5%

    Value: 11.6%

  • Fair Valuation

    Earnings Yield > 3.5%

    Value: 4.0%

  • Share Buybacks

    Share Count is Dropping

    Value: 0.0%

  • Defensible Moat

    Gross Profit Margin > 40%

    Value: 68.6%

  • Simple Business

    Not in a speculative sector (e.g., Biotech)

    Value: Technology

  • Conservative Debt

    Debt to Equity < 1.5

    Value: 0.15x

  • Consistent Growth

    5-Year Growth is Positive

    Value: 135.4%

Analysis Summary

Microsoft shows a commendable trifecta of strong profitability, a widening economic moat, and healthy financials, all underpinned by consistent growth. The conservative debt levels are particularly reassuring, adding a layer of safety to this operation. This business appears to be a well-oiled machine, churning out value for shareholders over the long haul.

Latest Posts

Microsoft Scores a Perfect 9/9 on Buffettology — Here's What That Means for Investors

February 3, 2026

Microsoft earns a rare perfect 9/9 Buffettology score — sky-high returns on capital, a fortress balance sheet, and consistent growth. But at $420+ per share, is the quality already priced in?

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