Alphabet Inc Class C (GOOG)
Interest coverage
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 115,327,000 | 108,836,000 | 101,628,000 | 96,149,000 | 86,025,000 | 78,781,000 | 73,802,000 | 70,953,000 | 71,685,000 | 78,967,000 | 85,774,000 | 88,738,000 | 91,080,000 | 85,303,000 | 75,569,000 | 61,798,000 | 48,217,000 | 40,196,000 | 35,440,000 | 39,322,000 |
| Interest expense (ttm) | US$ in thousands | 245,000 | 263,000 | 322,000 | 322,000 | 308,000 | 329,000 | 314,000 | 354,000 | 357,000 | 384,000 | 360,000 | 353,000 | 346,000 | 282,000 | 253,000 | 190,000 | 135,000 | 99,000 | 74,000 | 86,000 |
| Interest coverage | 470.72 | 413.83 | 315.61 | 298.60 | 279.30 | 239.46 | 235.04 | 200.43 | 200.80 | 205.64 | 238.26 | 251.38 | 263.24 | 302.49 | 298.69 | 325.25 | 357.16 | 406.02 | 478.92 | 457.23 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $115,327,000K ÷ $245,000K
= 470.72
Alphabet Inc Class C has shown a fluctuating trend in its interest coverage ratio over the past few years. The interest coverage ratio, calculated as earnings before interest and taxes (EBIT) divided by interest expense, reflects the company's ability to pay its interest expenses.
From March 31, 2020, to December 31, 2020, the interest coverage ratio decreased from 457.23 to 357.16, indicating a potential decline in the company's ability to cover its interest payments from its operating profits. The ratio continued to decrease steadily through March 31, 2021, reaching a low of 251.38.
However, starting from June 30, 2021, onwards, there was a slight improvement in the interest coverage ratio. The ratio increased to 315.61 by June 30, 2024, and further surged to 470.72 by December 31, 2024. This improvement suggests that Alphabet Inc Class C's profitability and operating performance might have strengthened, enabling the company to better cover its interest obligations.
Overall, while the interest coverage ratio exhibited some volatility in the past, the recent uptrend indicates a positive development in Alphabet Inc Class C's ability to service its interest payments effectively.
Peer comparison
Dec 31, 2024