ZoomInfo Technologies Inc. (GTM)

Interest coverage

		Mar 31, 2025	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
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	31,100	70,700	287,500	314,100	395,500	434,000	232,500	223,000	194,400	147,300	194,000	150,800	153,400	144,700	122,700	126,500	38,900	34,800	12,700	3,600
Interest expense (ttm)	US$ in thousands	39,000	39,300	40,900	43,200	45,400	45,200	46,300	46,000	45,700	47,600	48,500	50,800	49,200	43,900	40,500	36,300	51,300	69,300	84,800	101,600
Interest coverage		0.80	1.80	7.03	7.27	8.71	9.60	5.02	4.85	4.25	3.09	4.00	2.97	3.12	3.30	3.03	3.48	0.76	0.50	0.15	0.04

March 31, 2025 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $31,100K ÷ $39,000K
= 0.80

The interest coverage ratio of ZoomInfo Technologies Inc. demonstrates significant variation over the analyzed period, reflecting fluctuations in the company's ability to meet interest obligations from its earnings.

Starting from a notably low level of 0.04 as of June 30, 2020, the ratio gradually increased across subsequent periods, indicating an improving capacity to cover interest expenses. By December 31, 2020, the ratio reached 0.50, and it further expanded to 3.48 at June 30, 2021, suggesting a substantial strengthening in financial stability and earnings power. The trend stabilized around the 3.0 to 4.0 range through late 2021 and during 2022, with the interest coverage peaking at 5.02 as of September 30, 2023.

This upward trajectory indicates that the company was generating sufficient earnings to comfortably cover interest expenses, reducing financial risk during this period. However, towards the end of the analyzed timeline, the ratio declined sharply, dropping to 1.80 by December 31, 2024, and further decreasing to 0.80 as of March 31, 2025. This decline signals a deterioration in the company's ability to service its interest obligations from its current earnings levels, implying increased financial strain and a potential risk of interest payment difficulties.

Overall, the interest coverage ratio shows a prior period of strengthening financial health, followed by a concerning weakening in recent periods, emphasizing the importance of ongoing monitoring of earnings and interest obligations for ZoomInfo Technologies Inc.