Marathon Digital Holdings Inc (MARA)
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 | 312,887 | 212,553 | 451,522 | 667,829 | 287,949 | -363,006 | -504,552 | -686,478 | -703,047 | -258,034 | -205,409 | -116,278 | -12,950 | -52,642 | -32,461 | 74,633 | -9,818 | -6,583 | -5,397 | -4,347 |
| Interest expense (ttm) | US$ in thousands | 12,996 | 6,181 | 6,375 | 7,846 | 10,350 | 13,802 | 15,018 | 15,926 | 14,980 | 11,881 | 8,129 | 4,382 | 1,569 | 2 | 2 | 9 | 21 | 36 | 49 | 53 |
| Interest coverage | 24.08 | 34.39 | 70.83 | 85.12 | 27.82 | -26.30 | -33.60 | -43.10 | -46.93 | -21.72 | -25.27 | -26.54 | -8.25 | -26,321.00 | -16,230.50 | 8,292.56 | -467.52 | -182.86 | -110.14 | -82.02 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $312,887K ÷ $12,996K
= 24.08
The interest coverage ratio for Marathon Digital Holdings Inc fluctuated significantly over the period from March 31, 2020, to December 31, 2024. The company experienced negative interest coverage ratios for most of the period, indicating that its earnings before interest and taxes were insufficient to cover its interest expenses.
During the first half of 2021, the interest coverage ratio plummeted into the negative thousands and tens of thousands, suggesting severe financial strain and an inability to meet interest payments with operating income. This indicates a high risk of default on debt obligations during that period.
However, starting from the end of 2021, the interest coverage ratio showed a positive trend, indicating an improvement in the company's ability to cover its interest expenses with operating income. By the end of December 31, 2023, the interest coverage ratio was above 1, indicating that the company's earnings were finally able to cover its interest expenses.
The positive trend continued into 2024, with the interest coverage ratio showing consistent improvement, reaching levels that indicate the company has significantly strengthened its capacity to service its interest payments. This development suggests a more stable financial position and reduced risk of default on debt obligations compared to previous periods.
Overall, the analysis of Marathon Digital Holdings Inc's interest coverage ratio reflects a significant turnaround from a period of financial distress to a more stable financial position, indicating improved operating performance and ability to cover interest expenses.
Peer comparison
Dec 31, 2024