# MICROSOFT CORPORATION (MSFT) FY2026 Q2 Statement of Cash Flows

- Company: MICROSOFT CORPORATION (MSFT)
- Period: 2025-10-01 to 2025-12-31
- Filing: Q2 FY2026 10-Q, filed 2026-01-28, accession number 0001193125-26-027207
- Page: https://plicit.ai/financials/msft/fy2026-q2-cash-flow
- Chart image: https://plicit.ai/charts/msft-fy2026-q2-cash-flow-sankey.png

## Chart details

Cash flows for Oct 1, 2025 through Dec 31, 2025. Cash basis: Cash, cash equivalents, and restricted cash. Beginning cash: Sep 30, 2025. Ending cash: Dec 31, 2025. Beginning and ending cash are dated balances. Positive cash flows add cash; negative cash flows reduce it.

- **Beginning cash on Sep 30, 2025**: 28,849,000,000 US dollars. Beginning cash: Cash, cash equivalents, and restricted cash
- **Operating activities**: 35,758,000,000 US dollars. Net cash provided.
- **Net income**: 38,458,000,000 US dollars
- **Depreciation, amortization, and other**: 9,198,000,000 US dollars
- **Stock-based compensation expense**: 3,219,000,000 US dollars
- **Net recognized losses (gains) on investments and derivatives**: negative 9,931,000,000 US dollars
- **Deferred income taxes**: 4,446,000,000 US dollars
- **Accounts receivable**: negative 3,436,000,000 US dollars
- **Inventories**: 70,000,000 US dollars
- **Other current assets**: 619,000,000 US dollars
- **Other long-term assets**: negative 1,288,000,000 US dollars
- **Accounts payable**: 1,197,000,000 US dollars
- **Unearned revenue**: negative 7,483,000,000 US dollars
- **Income taxes**: negative 920,000,000 US dollars
- **Other current liabilities**: 2,802,000,000 US dollars
- **Other long-term liabilities**: negative 1,193,000,000 US dollars
- **Investing activities**: negative 22,705,000,000 US dollars. Net cash used.
- **Additions to property and equipment**: negative 29,876,000,000 US dollars
- **Acquisition of companies, net of cash acquired and divestitures, and purchases of intangible and other assets**: negative 455,000,000 US dollars
- **Purchases of investments**: negative 9,845,000,000 US dollars
- **Maturities of investments**: 12,417,000,000 US dollars
- **Sales of investments**: 5,691,000,000 US dollars
- **Other, net**: negative 637,000,000 US dollars
- **Financing activities**: negative 17,617,000,000 US dollars. Net cash used.
- **Repayments of debt, maturities of 90 days or less**: 0 US dollars
- **Repayments of debt**: negative 3,000,000,000 US dollars
- **Common stock issued**: 259,000,000 US dollars
- **Common stock repurchased**: negative 7,415,000,000 US dollars
- **Common stock cash dividends paid**: negative 6,762,000,000 US dollars
- **Other, net**: negative 699,000,000 US dollars
- **Operating adjustment reconciliation**: 24,251,000,000 US dollars. Intermediate calculation joining the operating reconciliation branches. Its gross amount includes any portion of net income routed through this junction. It is not an additional cash source or use.
- **financing gross reconciliation**: 17,876,000,000 US dollars. Gross amount at the activity's junction before offsetting its receipts and deductions. It is not an additional cash source or use.
- **investing gross reconciliation**: 40,813,000,000 US dollars. Gross amount at the activity's junction before offsetting its receipts and deductions. It is not an additional cash source or use.
- **Exchange-rate effect**: 11,000,000 US dollars
- **Ending cash on Dec 31, 2025**: 24,296,000,000 US dollars. Ending cash: Cash, cash equivalents, and restricted cash
- **Cash sources and uses**: 64,618,000,000 US dollars. Opening cash plus net sources, equal to net uses plus ending cash.
- **Net cash change**: negative 4,553,000,000 US dollars. Ending cash minus beginning cash.
- **Cash flow / Net income**: 0.93×. Operating cash flow divided by reconciliation net income for the same period. Black from 0.90× through 1.10×; green above 1.10×; red below 0.90×. Color uses the unrounded ratio.
- **Operating cash flow**: 35,758,000,000 US dollars. Operating cash flow used in the free cash flow calculation.
- **Cash purchases of property, plant and equipment**: 29,876,000,000 US dollars. These cash purchases are already included in investing activities above.
- **Free cash flow**: 5,882,000,000 US dollars. A supplemental measure; finance-lease payments are excluded from this definition.

### Chart connections

- Beginning cash plus operating, investing and financing cash flows plus the exchange-rate effect equals ending cash. Negative amounts reduce cash.
- Financing contributions meet at a reconciliation junction before connecting to the net cash total.
- Investing contributions meet at a reconciliation junction before connecting to the net cash total.
- Operating reconciliation adjustments are not all independent cash receipts.
- Net income exceeds operating cash. The diagram allocates $35.76B of net income directly to operating cash and $2.70B to the adjustment junction, where it combines with other additions to reconcile deductions. This is an accounting presentation, not a tracing of cash receipts.
- Each activity has one net cash bar connected to the shared cash pool. Positive activity totals enter the pool; negative activity totals leave the pool to fund that activity's net payments. The central pool does not assign a particular funding source to a particular payment.
- The intermediate calculation bars include both sides of the displayed activity breakdowns; they are not additional cash flows.
- Operating cash flow minus cash purchases of property, plant and equipment equals free cash flow: 35,758,000,000 US dollars minus 29,876,000,000 US dollars equals 5,882,000,000 US dollars.