Extreme Networks Inc (EXTR)

Debt-to-capital ratio

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Long-term debt	US$ in thousands	178,265	187,591	270,570	315,865	394,585
Total stockholders’ equity	US$ in thousands	25,282	116,752	90,343	54,468	5,398
Debt-to-capital ratio		0.88	0.62	0.75	0.85	0.99

June 30, 2024 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $178,265K ÷ ($178,265K + $25,282K)
= 0.88

The debt-to-capital ratio of Extreme Networks Inc has fluctuated over the past five years, indicating changes in the company's capital structure and financial leverage. The ratio has trended downwards from 0.99 in 2020 to 0.62 in 2023, before increasing to 0.88 in 2024.

A high debt-to-capital ratio, such as seen in 2020 and 2024, suggests that Extreme Networks relies more heavily on debt financing to fund its operations and growth, which can lead to higher financial risk and interest payments. Conversely, a lower ratio, as observed in 2021 and 2023, indicates a reduced reliance on debt and potentially a stronger financial position.

It is essential for investors and stakeholders to monitor changes in the debt-to-capital ratio over time, as it can provide insights into the company's financial health, risk profile, and capital structure strategies. Further analysis of the company's financial statements and overall market conditions would be necessary to fully understand the implications of these fluctuations.