Dr. Paul Borosky, DBA, MBA
Business Consultant & Author
Guide 12 of 34 · The Balance Sheet
Is Short-Term Investment a Current Asset?
Yes, they count. And they tell you something about the cash.
Short-term investments sit right under cash on the balance sheet. They are current assets because a company can sell them within a year. Apple’s fell from $35.2 billion to $18.8 billion in a single year. Where that money went says more about Apple than the line itself.
Last Updated: 10/27/2026 · Written by Dr. Paul Borosky, DBA, MBA
The Short Answer
Are Short-Term Investments Current Assets?
Textbook Definition
Short-term investments are marketable securities a company expects to sell or that mature within 12 months. They are classified as current assets on the balance sheet, directly below cash and cash equivalents.
In Plain English
Yes. It is spare cash the company parked somewhere that earns a little interest instead of sitting idle. Because it can turn back into cash within a year, it counts as a current asset.
Cash Ratio
(Cash + Short-Term Investments) ÷ Current Liabilities
Apple, fiscal 2025: 0.33
Analysts often add short-term investments to cash, because both can pay bills quickly. That combined number feeds the cash ratio above, one of the four liquidity ratios.
One Real Company
Apple’s Short-Term Investments, 2021 to 2025
Watch 2025. The line dropped by almost half in one year while cash went up.
| Line | 2025 | 2024 | 2023 | 2022 | 2021 |
|---|---|---|---|---|---|
| Cash | 35,934 | 29,943 | 29,965 | 23,646 | 34,940 |
| Short-term investments | 18,763 | 35,228 | 31,590 | 24,658 | 27,699 |
| Cash + short-term investments | 54,697 | 65,171 | 61,555 | 48,304 | 62,639 |
| Short-term investments, % of sales | 4.5% | 9.0% | 8.2% | 6.3% | 7.6% |
| Short-term investments, % of total assets | 5.2% | 9.7% | 9.0% | 7.0% | 7.9% |
| Cash ratio | 0.33 | 0.37 | 0.42 | 0.31 | 0.50 |
Source: Apple Form 10-K filings as analyzed in the book. $ millions.
The Method
How to Read Short-Term Investments in 4 Steps
Find the line.
In Apple’s 10-K it is called marketable securities, current. It sits right under cash and cash equivalents.
Add it to cash.
Cash plus short-term investments is the real liquid cushion. Apple’s was about $54.7 billion in 2025.
Turn it into a percentage.
Divide by total assets or sales. Apple’s fell from 9.7% of total assets to 5.2% in one year.
Ask where the money went.
A sharp drop usually means the money moved to operations, debt payments, or buybacks. For Apple, buybacks are the likely answer.
Why Holding It Is a Good Sign
A company that owns short-term investments has more cash than it needs right now. That almost rules out a near-term cash crunch. The trade-off: idle money could go back to shareholders instead. Apple chose the shareholders, as the buyback guide shows.
Compare It
Apple vs. Microsoft: Who Keeps the Bigger Cushion?
| Latest fiscal year | Apple | Microsoft |
|---|---|---|
| Short-term investments | about $19B | about $64B |
| Cash + short-term investments | about $55B | about $95B |
Microsoft’s fiscal year ends in June, Apple’s in September.
Microsoft parks far more money in short-term investments. That fits the pattern across the whole comparison. Microsoft keeps cash on the balance sheet. Apple sends more of it out the door through buybacks. Neither is wrong. They are two different strategies, and the balance sheet shows both.
What Counts
What Counts as a Short-Term Investment?
The test is time. If the company expects to sell it, or it matures, within 12 months, it is short-term. If not, it moves to long-term assets, further down the balance sheet.
Most short-term investments are boring on purpose. The goal is to earn a little on cash that is not needed this month, without risking the money. It is not a big revenue generator. It just beats leaving cash sitting in an account that pays nothing.
- Treasury bills and other government securities maturing within a year.
- Certificates of deposit with short terms.
- Commercial paper issued by other companies.
- Corporate bonds the company plans to sell within a year.
- Money market holdings that do not qualify as cash equivalents.
Apple’s 2025 drop is the interesting part. Short-term investments fell from $35.2 billion to $18.8 billion, a swing of about $16.5 billion, while cash rose about $6.0 billion. The money did not vanish. It moved. When a cash-rich company shrinks its parked investments in the same years it buys back $78 billion to $95 billion of stock, the two are usually connected. The cushion got smaller, but the business that refills it every year did not change.
Beginner Traps
What Do Beginners Get Wrong About Short-Term Investments?
- Leaving them out when measuring how much cash a company has.
- Mixing them up with long-term investments, which are not current assets.
- Reading a big drop as trouble without checking where the money went.
- Assuming more parked cash is always better for shareholders.
- Missing the 10-K label, marketable securities.
- Comparing dollars across companies instead of percentages.
How the Book Grades Apple’s Cash Cushion
From the Book
What Holding Investments Really Signals
Balance Sheet · Short-Term Investments
A Sign of Spare Cash
Almost every time a company uses short-term investments, it indicates excess cash on hand. On the plus side, we can almost certainly rule out insolvency for the near term.
Every current asset on Apple’s balance sheet, five years of numbers, and a grade for each.
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Short-Term Investment Questions
Are short-term investments current assets?
What is the difference between cash equivalents and short-term investments?
What are marketable securities on a balance sheet?
Keep Going
Related Guides
Short-term investments connect to cash, liquidity, and where the money goes next.
Written by Dr. Paul Borosky, DBA, MBA, business consultant, author, and adjunct finance instructor with an MBA focused in finance.
This page is for general educational purposes only. It is not investment, financial, tax, accounting, or legal advice, and nothing here is a recommendation to buy or sell any security. Apple and Microsoft figures come from their public filings as analyzed in the book. Apple and Microsoft are trademarks of their respective owners, and this page is not affiliated with or endorsed by either company.