Intuit Inc (INTU)

Interest coverage

		Jul 31, 2025	Jul 31, 2024	Jul 31, 2023	Jul 31, 2022	Jul 31, 2021
Earnings before interest and tax (EBIT)	US$ in thousands	5,081,000	3,792,000	3,237,000	2,623,000	2,585,000
Interest expense	US$ in thousands	247,000	242,000	248,000	81,000	29,000
Interest coverage		20.57	15.67	13.05	32.38	89.14

July 31, 2025 calculation

Interest coverage = EBIT ÷ Interest expense
= $5,081,000K ÷ $247,000K
= 20.57

The interest coverage ratio of Intuit Inc. demonstrates notable fluctuations over the specified period from July 31, 2021, to July 31, 2025. As of July 31, 2021, the company exhibited a very high interest coverage ratio of 89.14, indicating a substantial buffer between earnings and interest expenses, thereby suggesting a robust ability to meet interest obligations comfortably.

However, by July 31, 2022, the ratio declined significantly to 32.38, representing a substantial decrease in the company's capacity to cover interest expenses, though it still remained at a healthy level. This trend continued into July 31, 2023, with the ratio decreasing further to 13.05, signaling a material reduction in interest coverage and implying a tightening of the company's margin to meet interest obligations, potentially exposing the company to increased financial risk if earnings do not stabilize or grow.

Subsequently, the interest coverage ratio shows signs of recovery, rising to 15.67 by July 31, 2024. This improvement suggests that the company's earnings are improving relative to its interest expenses, though it remains at a modest level compared to earlier years. The projected ratio for July 31, 2025, is 20.57, indicating further strengthening in the company's ability to cover interest costs, though it has not yet returned to the exceptionally high levels observed in 2021.

Overall, the data indicates a period of pronounced decline in interest coverage, followed by a recovery trend. The fluctuations highlight varying levels of earnings relative to interest expenses, with recent projections suggesting a cautious but positive outlook on the company's capacity to meet interest obligations.