Laser interferometry is a well-established and widely used technique for precise displacement measurements. In a non-contact atomic force microscope (NC-AFM) it facilitates the force measurement by recording the periodic displacement of an oscillating micro-cantilever. To understand signal generation in a NC-AFM based on a Michelson type interferometer, we evaluate the non-linear response of the interferometer to the harmonic displacement of the cantilever in the time domain. As the interferometer signal is limited in amplitude due to the spatial periodicity of the interferometer light field, an increasing cantilever oscillation amplitude creates an output signal with an increasingly complex temporal structure. By the fit of a model to the measured time-domain signal, all parameters governing the interferometric displacement signal can be precisely determined. It is demonstrated, that such an analysis specifically allows the calibration of the cantilever oscillation amplitude with 0.15% accuracy.