Expedia Group Inc. (EXPE)

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	1,319,000	1,372,000	824,000	310,000	-2,675,000
Interest expense	US$ in thousands	246,000	245,000	277,000	351,000	360,000
Interest coverage		5.36	5.60	2.97	0.88	-7.43

December 31, 2024 calculation

Interest coverage = EBIT ÷ Interest expense
= $1,319,000K ÷ $246,000K
= 5.36

Interest coverage is a key financial ratio that provides insight into a company's ability to meet its interest payment obligations. It is calculated by dividing a company's earnings before interest and taxes (EBIT) by its interest expense.

In the case of Expedia Group Inc., the trend in interest coverage over the years indicates the company's changing ability to cover its interest expenses.

- As of December 31, 2020, the interest coverage ratio was negative at -7.43, indicating that the company's EBIT was insufficient to cover its interest expenses, potentially raising concerns about its financial health.
- By December 31, 2021, the interest coverage ratio improved but remained below 1 at 0.88, suggesting that the company was still struggling to cover its interest payments with its earnings.
- The ratio continued to increase in the following years, reaching 2.97 by December 31, 2022, and further improving to 5.60 by December 31, 2023, indicating a positive trend in the company's ability to meet its interest obligations.
- However, there was a slight decrease in the interest coverage ratio to 5.36 by December 31, 2024, which may warrant monitoring to ensure the company maintains a healthy level of coverage.

Overall, Expedia Group Inc. has shown improvements in its interest coverage over the years, with recent ratios indicating a better ability to meet its interest payment obligations. Investors and stakeholders should continue to monitor this ratio to assess the company's financial stability and debt repayment capabilities.