EX-12 3 msft-ex12_12.htm EX-12 msft-ex12_12.htm

 

Exhibit 12

COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES

 

(In millions, except ratios)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended June 30,

 

2017

 

 

2016

 

 

2015

 

 

2014

 

 

2013

 

 

 

 

 

 

 

Earnings (a)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings from continuing operations before income taxes

 

$

  23,149

 

 

$

  19,751

 

 

$

  18,507

 

 

$

  27,820

 

 

$

  27,052

 

Add: Fixed charges

 

 

2,324

 

 

 

1,326

 

 

 

867

 

 

 

674

 

 

 

489

 

Add: Cash distributions from equity method investments

 

 

12

 

 

 

12

 

 

 

1

 

 

 

54

 

 

 

71

 

Subtract: Loss from equity method investments

 

 

(14

)

 

 

(25

)

 

 

(78

)

 

 

(152

)

 

 

(99

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Earnings

 

$

25,499

 

 

$

21,114

 

 

$

19,453

 

 

$

28,700

 

 

$

27,711

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed Charges (b)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

$

2,141

 

 

$

1,185

 

 

$

756

 

 

$

577

 

 

$

394

 

Capitalized debt related expenses

 

 

81

 

 

 

58

 

 

 

25

 

 

 

20

 

 

 

35

 

Interest component of rental expense

 

 

102

 

 

 

82

 

 

 

86

 

 

 

77

 

 

 

60

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Fixed Charges

 

$

2,324

 

 

$

1,325

 

 

$

867

 

 

$

674

 

 

$

489

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of Earnings to Fixed Charges

 

 

11

 

 

 

16

 

 

 

22

 

 

 

43

 

 

 

57

 

(a)

Earnings represent earnings from continuing operations before income taxes and before income (losses) from equity method investments plus: (1) fixed charges; and (2) cash distributions from equity method investments.

(b)

Fixed charges include: (1) interest expense; (2) capitalized debt issuance costs; and (3) the portion of operating rental expense which management believes is representative of the interest component of rental expense.