Axon Enterprise Inc. (AXON)
Interest coverage
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 388,602 | 161,995 | 196,518 | -173,696 | -12,950 |
| Interest expense | US$ in thousands | 7,098 | 6,995 | 103,265 | 26,748 | 100 |
| Interest coverage | 54.75 | 23.16 | 1.90 | -6.49 | -129.50 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $388,602K ÷ $7,098K
= 54.75
The interest coverage ratio of Axon Enterprise Inc. has shown a fluctuating trend over the past few years. In December 2020, the interest coverage ratio was significantly negative at -129.50, indicating the company's earnings were insufficient to cover its interest expense. This raised concerns about its ability to meet its debt obligations.
By December 2021, although still negative at -6.49, there was a slight improvement in the interest coverage ratio compared to the previous year. However, the company remained in a vulnerable position with earnings not comfortably covering interest payments.
In December 2022, Axon Enterprise Inc. managed to achieve a positive interest coverage ratio of 1.90, indicating that its earnings were just enough to cover its interest expenses. While this was an improvement from the previous years, the margin was still quite slim, suggesting that the company's financial stability could still be precarious.
The interest coverage ratio saw a significant improvement by December 2023, reaching 23.16. This marked a substantial strengthening of the company's ability to cover its interest payments, reflecting better financial performance and reduced risk.
Finally, by December 2024, the interest coverage ratio further improved to 54.75, indicating a robust financial position with ample earnings to comfortably meet its interest obligations. This significant improvement over the years signifies a healthier financial position for Axon Enterprise Inc., reflecting better profitability and reduced financial risk.
Peer comparison
Dec 31, 2024