Microsoft FY2025 Earnings: Inside a $282B Money Machine

Microsoft's FY2025 10-K reads like a machine spec: three segments that each clear $50B, a gross margin close to 69%, and more than a third of every revenue dollar landing as net income. The flow makes the machine visible.

📊 The headline numbers

• Revenue: $281.7B, up across all three segments
• Gross profit: $193.9B (68.8% margin)
• Operating profit: $128.5B (45.6% margin — among the best of any mega-cap)
• Net profit: $101.8B (36.1% margin)

☁️ The left fan: three engines, one machine

• Productivity & Business Processes: $120.8B — Office, Microsoft 365, LinkedIn, Dynamics
• Intelligent Cloud: $106.3B — Azure, server products, enterprise services
• More Personal Computing: $54.6B — Windows, Xbox, Surface, search ads

No segment is less than 19% or more than 43% of revenue. Compare that with Apple's iPhone ribbon or NVIDIA's data-center ribbon: Microsoft is the diversified one among the mega-caps.

💰 Where the dollars go

From $193.9B of gross profit:

• R&D: $32.5B — 11.5% of revenue and the largest of the three opex lines
• Sales & Marketing: $25.7B
• G&A: $7.2B — a rounding error for a company this size
• Operating profit: $128.5B flows on; after $4.9B of net other expense and $21.8B of tax (a 17.6% effective rate), $101.8B reaches shareholders

🧮 The ratio that matters

45.6% operating margin means Microsoft converts revenue to operating profit at nearly half. For every dollar customers spend with Microsoft, about 46 cents becomes operating income. Software economics at planetary scale.

The bottom line

The FY2025 flow shows a company that no longer has a weak segment: the smallest ribbon still produced $54.6B. The real story is the middle of the chart — a 68.8% gross margin funding $65B of opex while still letting $128.5B through.

See it live, hover any ribbon, or flip to another quarter on Sankify — the chart draws itself from the filing in about ten seconds.