DexCom Inc (DXCM)

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	623,000	730,700	409,400	275,600	309,700
Interest expense	US$ in thousands	19,000	20,300	18,600	102,000	84,700
Interest coverage		32.79	36.00	22.01	2.70	3.66

December 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $623,000K ÷ $19,000K
= 32.79

DexCom Inc's interest coverage ratio has shown fluctuations over the past few years. In December 2020, the interest coverage ratio was 3.66, indicating that the company's operating income was able to cover its interest expenses approximately 3.66 times. However, by December 2021, the ratio decreased to 2.70, suggesting a decrease in the company's ability to cover its interest costs.

The trend reversed significantly in December 2022, with a notable increase in the interest coverage ratio to 22.01, demonstrating a much stronger ability to cover interest expenses. This improvement continued in the following years, as indicated by ratios of 36.00 in December 2023 and 32.79 in December 2024. These ratios suggest a substantial improvement in DexCom Inc's financial health and operational efficiency in managing its interest obligations.

Overall, while the company experienced some variability in its interest coverage ratio in recent years, the significant improvement from 2021 to 2022 and the consistently high ratios from 2022 to 2024 indicate a positive trend in DexCom Inc's ability to comfortably meet its interest payments using its operating income.