v3.26.1
UNEARNED REVENUE
 9 Months Ended
Mar. 31, 2026
Revenue from Contract with Customer [Abstract]  
UNEARNED REVENUE

NOTE 11 — UNEARNED REVENUE

Unearned revenue by segment was as follows:

 

(In millions)

 

 

 

 

 

 

 

 

March 31,

2026

June 30,

2025

 

 

Productivity and Business Processes

$

39,904

$

50,567

Intelligent Cloud

10,892

14,022

More Personal Computing

2,881

2,676

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

$

53,677

$

67,265

 

 

 

 

 

 

 

 

 

Changes in unearned revenue were as follows:

 

(In millions)

 

 

Nine Months Ended March 31, 2026

 

 

Balance, beginning of period

$

67,265

 

Deferral of revenue

143,442

 

Recognition of unearned revenue

(157,030

)

 

 

 

 

 

 

Balance, end of period

$

53,677

 

 

 

Revenue allocated to remaining performance obligations, which includes unearned revenue and amounts expected to be invoiced and recognized as revenue in future periods, was $633 billion as of March 31, 2026. Estimating revenue that will be allocated to remaining performance obligations can involve significant judgments, including identifying and assessing variable consideration and potential renegotiation of commitments. We consider factors such as the nature of the terms and duration of the contract across our portfolio of contracts. Revenue allocated to remaining performance obligations related to the commercial portion of revenue was $627 billion as of March 31, 2026, with a weighted average duration of approximately 2.5 years. We expect to recognize approximately 30% of our total company remaining performance obligation revenue and 25% of our commercial remaining performance obligation revenue over the next 12 months and the remainder thereafter.