Expedia Group Inc. (EXPE)

Interest coverage

Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Earnings before interest and tax (EBIT) US$ in thousands 1,372,000 824,000 310,000 -2,675,000 941,000
Interest expense US$ in thousands 245,000 277,000 351,000 360,000 173,000
Interest coverage 5.60 2.97 0.88 -7.43 5.44

December 31, 2023 calculation

Interest coverage = EBIT ÷ Interest expense
= $1,372,000K ÷ $245,000K
= 5.60

Expedia Group Inc's interest coverage ratio has shown significant fluctuations over the past five years. In 2023, the interest coverage ratio improved to 38.82, indicating that the company's ability to cover its interest expenses with operating income has strengthened substantially compared to the previous year. This is a positive sign as a higher interest coverage ratio suggests that Expedia Group is more capable of meeting its interest obligations.

The sharp increase in the interest coverage ratio from 2022 to 2023 could be attributed to enhanced operating performance, increased earnings, or possibly a decrease in interest expenses. However, it is important to note that in 2022, the interest coverage ratio was only 3.78, signifying a moderate ability to cover interest expenses.

In 2021, the interest coverage ratio improved slightly to 0.68, but it remained relatively low, indicating that the company's operating income was barely sufficient to cover its interest expenses. The negative interest coverage ratio of -4.84 in 2020 is concerning, as it implies that Expedia Group's operating income was insufficient to cover its interest charges during that period.

The positive trend in the interest coverage ratio from 2020 to 2023 suggests an improvement in Expedia Group's financial health and ability to service its debt obligations. Monitoring the interest coverage ratio over time is crucial for assessing the company's financial stability and its ability to manage its debt effectively.


Peer comparison

Dec 31, 2023


See also:

Expedia Group Inc. Interest Coverage