Apple Inc (AAPL)
Debt-to-equity ratio
| Sep 30, 2023 | Sep 30, 2022 | Sep 30, 2021 | Sep 30, 2020 | Sep 30, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 95,281,000 | 98,959,000 | 109,106,000 | 98,667,000 | 91,807,000 |
| Total stockholders’ equity | US$ in thousands | 62,146,000 | 50,672,000 | 63,090,000 | 65,339,000 | 90,488,000 |
| Debt-to-equity ratio | 1.53 | 1.95 | 1.73 | 1.51 | 1.01 |
September 30, 2023 calculation
Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $95,281,000K ÷ $62,146,000K
= 1.53
The debt-to-equity ratio indicates the proportion of a company's financing that comes from debt compared to equity. A higher ratio implies a greater dependence on debt to finance operations, while a lower ratio indicates a larger reliance on equity.
Looking at Apple Inc's debt-to-equity ratio over the past five years, we observe a fluctuating trend. In 2019, the ratio was 1.19, indicating that for every dollar of equity, the company had $1.19 of debt. This relatively low ratio reflected a strong equity position and a lower reliance on debt for financing.
In the subsequent years, the ratio increased, reaching 1.72 in 2020, 1.98 in 2021, and 2.37 in 2022. These rising figures suggest a growing leverage and an increasing proportion of debt in the company's capital structure. The significant increase in 2022, from 1.72 to 2.37, signals a substantial rise in debt relative to equity, which could raise concerns about the company's financial risk and ability to meet its obligations.
However, the most recent data point from September 30, 2023, shows a decrease in the debt-to-equity ratio to 1.79. While this figure is still higher than in 2019, the decline indicates a reduction in the proportion of debt compared to equity, which could be viewed favorably as it implies a lower financial risk and a more balanced capital structure.
In conclusion, Apple Inc's debt-to-equity ratio has shown fluctuations in the past five years, with a general upward trend indicating an increasing reliance on debt for financing. However, the recent decrease in the ratio may signify a positive shift towards a more balanced capital structure. Understanding the context behind these changes, such as the company's strategic decisions and industry dynamics, is essential for a comprehensive assessment of its financial position.
Peer comparison
Sep 30, 2023