Corsair Gaming Inc (CRSR)
Interest coverage
| Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 9,689 | 11,205 | 975 | -51,271 | -54,793 | -43,296 | -21,553 | 68,120 | 137,894 | 171,650 | 210,639 |
| Interest expense (ttm) | US$ in thousands | 379 | 415 | 340 | 252 | 203 | 138 | 214 | 293 | 327 | -27,852 | -17,772 |
| Interest coverage | 25.56 | 27.00 | 2.87 | -203.46 | -269.92 | -313.74 | -100.71 | 232.49 | 421.69 | — | — |
December 31, 2023 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $9,689K ÷ $379K
= 25.56
Corsair Gaming Inc's interest coverage ratio fluctuated significantly over the past eight quarters. In Q4 2023, the company had an interest coverage ratio of 0.92, indicating that its operating income was only sufficient to cover 92% of its interest expenses. The ratio improved slightly in Q3 2023 to 0.99 but remained below 1, suggesting that the company's ability to meet its interest obligations was still constrained.
In Q2 2023, Corsair Gaming Inc's interest coverage ratio was a meager 0.08, signaling a concerning situation where the company's operating income was barely able to cover its interest expenses. The situation worsened dramatically in Q1 2023, with a negative interest coverage ratio of -4.78, indicating that the company's operating income was insufficient to cover its interest expenses, which raises concerns about its financial viability.
Looking back further, the trend of declining interest coverage ratios is evident. Throughout 2022, the company consistently had negative interest coverage ratios, with the lowest recorded in Q3 2022 at -6.46. However, there was a brief improvement in Q1 2022, where the interest coverage ratio turned positive at 4.86, suggesting a short-term improvement in the company's ability to cover its interest expenses.
Overall, the fluctuating and generally low interest coverage ratios for Corsair Gaming Inc indicate a concerning trend where the company may be facing challenges in generating sufficient operating income to meet its interest obligations consistently. This situation may raise red flags for investors and creditors regarding the company's financial health and ability to service its debt effectively.
Peer comparison
Dec 31, 2023