MSFT · 10-K · 2025A · Full report

Investment Impairments (OpenAI Losses)

MICROSOFT CORP · 2025-07-30 · Importance 65 · Surprise 82

Other income (expense), net worsened materially year-over-year to a net loss of $4,901 million for fiscal 2025, with net recognized losses on investments increasing to $349 million (from $118 million) primarily due to higher impairments. Net losses on derivatives increased to $260 million (from $187 million) in the current period. Management states that Other, net primarily reflects net recognized losses on equity method investments, including OpenAI, indicating realized or recognized losses on strategic equity stakes. The company uses derivatives across currencies, interest rates, and equities and recognizes gains and losses from non-hedging fair value changes in Other income (expense), net.

Key facts

• Other, net in other income (expense), net primarily reflects net recognized losses on equity method investments, including OpenAI, and contributed to total other income (expense), net of $(4,901) million for fiscal year 2025.
• Net recognized losses on investments were $(349) million for fiscal year 2025, up from $(118) million in fiscal year 2024.
• Microsoft’s Other, net loss in fiscal year 2025 primarily reflects net recognized losses on equity method investments, including OpenAI.

Impact estimates