Electronic Arts Inc (EA)

Solvency ratios

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
Debt-to-assets ratio 0.14 0.14 0.14 0.14 0.14 0.14 0.14 0.14 0.14 0.13 0.14 0.15 0.14 0.03 0.03 0.04 0.04 0.09 0.09 0.10
Debt-to-capital ratio 0.20 0.20 0.20 0.20 0.20 0.20 0.19 0.20 0.20 0.20 0.19 0.20 0.19 0.05 0.05 0.05 0.05 0.12 0.12 0.13
Debt-to-equity ratio 0.25 0.25 0.25 0.26 0.26 0.25 0.24 0.25 0.25 0.25 0.24 0.24 0.24 0.05 0.05 0.05 0.05 0.14 0.14 0.15
Financial leverage ratio 1.79 1.81 1.73 1.78 1.85 1.78 1.68 1.73 1.81 1.82 1.66 1.65 1.69 1.61 1.42 1.45 1.49 1.54 1.48 1.50

Electronic Arts Inc has maintained a consistent and relatively low level of leverage over the past few years, as indicated by its solvency ratios. The debt-to-assets ratio has consistently been around 0.14, suggesting that only 14% of the company's assets are financed by debt. The debt-to-capital ratio and debt-to-equity ratio have also remained stable around 0.20 and 0.25, respectively, indicating a healthy balance between debt and equity in the company's capital structure.

The financial leverage ratio, which measures the proportion of assets financed by debt compared to equity, has generally fluctuated within a narrow range between 1.42 and 1.85. This indicates that Electronic Arts relies more on equity financing compared to debt, which is generally considered to be a positive sign of financial stability and solvency. The gradual increase in this ratio over the analyzed period may signal a slight increase in financial risk, but overall, Electronic Arts Inc appears to have a solid financial position with low debt levels.

Coverage ratios

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
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

The interest coverage ratio for Electronic Arts Inc has shown a generally positive trend over the past few years, indicating the company's ability to meet its interest obligations comfortably. The ratio has consistently been above 1, which is considered a good sign as it shows that the company's earnings are sufficient to cover its interest expenses.

Looking at the specific data points, we observe a gradual increase in the interest coverage ratio from 27.58 in June 2019 to 28.40 in March 2024. This steady improvement suggests that Electronic Arts Inc has been effectively managing its debt and generating enough operating income to service its interest payments.

Furthermore, the consistently high levels of interest coverage, with ratios ranging from 17.18 to 36.00 during the period under review, indicate the company's strong financial health and stability. The ratios above 20 are typically considered healthy, and Electronic Arts Inc has consistently surpassed this benchmark, demonstrating its robust ability to cover interest expenses with its operating earnings.

In conclusion, Electronic Arts Inc's interest coverage ratio reflects a strong financial position with a consistent upward trend, suggesting sound financial management and the capacity to honor its debt obligations.