Electronic Arts Inc (EA)
Interest coverage
| Mar 31, 2024 | 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 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 1,647,000 | 1,569,000 | 1,468,000 | 1,505,000 | 1,384,000 | 1,559,000 | 1,368,000 | 1,267,000 | 1,139,000 | 945,000 | 1,096,000 | 905,000 | 1,062,000 | 1,311,000 | 1,439,000 | 1,584,000 | 1,552,000 | 1,357,000 | 1,249,000 | 1,241,000 |
| Interest expense (ttm) | US$ in thousands | 58,000 | 59,000 | 58,000 | 59,000 | 58,000 | 58,000 | 58,000 | 58,000 | 58,000 | 55,000 | 52,000 | 48,000 | 45,000 | 45,000 | 44,000 | 44,000 | 44,000 | 44,000 | 45,000 | 45,000 |
| Interest coverage | 28.40 | 26.59 | 25.31 | 25.51 | 23.86 | 26.88 | 23.59 | 21.84 | 19.64 | 17.18 | 21.08 | 18.85 | 23.60 | 29.13 | 32.70 | 36.00 | 35.27 | 30.84 | 27.76 | 27.58 |
March 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,647,000K ÷ $58,000K
= 28.40
The interest coverage ratio measures a company's ability to meet its interest obligations with its earnings before interest and taxes (EBIT). A higher ratio indicates that the company is more capable of covering its interest expenses.
Analyzing Electronic Arts Inc's interest coverage over the past few quarters, we observe fluctuation in the ratio. The interest coverage ratio has generally been above 20 in recent quarters, indicating a strong ability to cover interest expenses. The trend shows some variability but overall demonstrates a healthy financial position.
In the most recent quarter, the interest coverage ratio was 28.40, reflecting a high level of comfort in meeting interest obligations. This suggests that Electronic Arts Inc has a significant margin of safety when it comes to servicing its debt.
Looking at the historical data, the interest coverage ratio has shown fluctuations but has consistently remained above 20, indicating a solid financial standing for the company. Overall, Electronic Arts Inc's interest coverage has been robust, providing investors and creditors with confidence in the firm's ability to meet its debt payment obligations.
Peer comparison
Mar 31, 2024