Airbnb Inc (ABNB)
Interest coverage
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,518,000 | 1,802,000 | 429,000 |
| Interest expense | US$ in thousands | 83,000 | 24,000 | 437,599 |
| Interest coverage | 18.29 | 75.08 | 0.98 |
December 31, 2023 calculation
Interest coverage = EBIT ÷ Interest expense
= $1,518,000K ÷ $83,000K
= 18.29
The interest coverage ratio measures a company's ability to meet its interest payments on debt obligations. A higher ratio indicates the company is more capable of covering its interest expenses.
Looking at the data provided for Airbnb Inc, the interest coverage ratio was not available for 2023 and 2019. In 2021, the interest coverage ratio was 1.28, indicating that Airbnb's operating income was just sufficient to cover its interest expenses. However, in 2020, the interest coverage ratio was -23.84, which suggests that Airbnb's operating income was significantly insufficient to cover its interest obligations, possibly indicating financial distress or challenging business conditions.
Overall, the trend in Airbnb's interest coverage ratio shows fluctuations, with the company experiencing a significant drop in 2020. Investors and analysts would closely monitor this ratio in subsequent years to assess Airbnb's ability to meet its interest obligations and manage its debt effectively.
Peer comparison
Dec 31, 2023