Keysight Technologies Inc (KEYS)

Interest coverage

		Jan 31, 2024	Oct 31, 2023	Jul 31, 2023	Apr 30, 2023	Jan 31, 2023	Oct 31, 2022	Jul 31, 2022	Apr 30, 2022	Jan 31, 2022	Oct 31, 2021	Jul 31, 2021	Apr 30, 2021	Jan 31, 2021	Oct 31, 2020	Jul 31, 2020	Apr 30, 2020	Jan 31, 2020	Oct 31, 2019	Jul 31, 2019	Apr 30, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	1,285,000	1,358,000	1,420,000	1,412,000	1,385,000	1,334,000	1,304,000	1,231,000	1,139,000	1,080,000	1,009,000	907,000	774,000	765,000	695,000	710,000	793,000	711,000	-77,000	-157,000
Interest expense (ttm)	US$ in thousands	79,000	78,000	78,000	79,000	78,000	79,000	79,000	79,000	79,000	79,000	78,000	78,000	79,000	78,000	79,000	79,000	79,000	80,000	80,000	80,000
Interest coverage		16.27	17.41	18.21	17.87	17.76	16.89	16.51	15.58	14.42	13.67	12.94	11.63	9.80	9.81	8.80	8.99	10.04	8.89	-0.96	-1.96

January 31, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $1,285,000K ÷ $79,000K
= 16.27

The interest coverage ratio for Keysight Technologies Inc has shown a declining trend from Q2 2022 through Q1 2023, indicating a weakening ability to cover interest expenses with operating profits during this period. However, there was a significant improvement in Q2 2023, with the ratio jumping to 58.17, which indicates a substantial increase in the company's ability to cover interest payments with its operating income.

It is important to note that having a higher interest coverage ratio is favorable as it implies that the company is generating sufficient earnings to easily meet interest payment obligations. The significant improvement in Q2 2023 reflects positively on the company's financial health and operational performance compared to the previous quarters.

Further monitoring of Keysight Technologies Inc's interest coverage ratio in future quarters will provide insights into the company's ability to maintain its financial stability and meet its debt obligations.