Micron Technology Inc (MU)
Interest coverage
| Feb 28, 2025 | Nov 30, 2024 | Aug 31, 2024 | Aug 29, 2024 | May 31, 2024 | May 30, 2024 | Feb 29, 2024 | Nov 30, 2023 | Aug 31, 2023 | Jun 1, 2023 | May 31, 2023 | Mar 2, 2023 | Feb 28, 2023 | Dec 1, 2022 | Nov 30, 2022 | Sep 1, 2022 | Aug 31, 2022 | Jun 2, 2022 | May 31, 2022 | Mar 3, 2022 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 7,308,000 | 6,303,000 | 4,892,000 | 3,560,000 | 910,000 | -1,427,000 | -3,924,000 | -5,804,000 | -6,845,000 | -7,676,000 | -6,174,000 | -4,720,000 | -958,000 | 2,866,000 | 6,030,000 | 9,146,000 | 10,126,000 | 11,151,000 | 10,693,000 | 10,320,000 |
| Interest expense (ttm) | US$ in thousands | 165,000 | 203,000 | 235,000 | 243,000 | 576,000 | 555,000 | 524,000 | 499,000 | 456,000 | 416,000 | 348,000 | 280,000 | 236,000 | 192,000 | 185,000 | 178,000 | 188,000 | 198,000 | 199,000 | 200,000 |
| Interest coverage | 44.29 | 31.05 | 20.82 | 14.65 | 1.58 | -2.57 | -7.49 | -11.63 | -15.01 | -18.45 | -17.74 | -16.86 | -4.06 | 14.93 | 32.59 | 51.38 | 53.86 | 56.32 | 53.73 | 51.60 |
February 28, 2025 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $7,308,000K ÷ $165,000K
= 44.29
The interest coverage ratio of Micron Technology Inc has shown significant fluctuations over the reporting periods provided.
From March 3, 2022, to June 2, 2022, the interest coverage ratio consistently increased, indicating the company's ability to comfortably cover its interest expenses with its earnings. However, there was a slight decrease in the ratio by September 1, 2022.
The ratio took a sharp decline by December 1, 2022, dropping to 14.93, which may raise some concerns about the company's ability to meet its interest obligations. The trend worsened further as the ratio turned negative by February 28, 2023, and remained negative until August 31, 2023.
The negative interest coverage ratios from February 28, 2023, to August 31, 2023, suggest that Micron Technology Inc's earnings were insufficient to cover its interest payments during these periods, indicating potential financial distress.
The company showed signs of improvement in its interest coverage from August 29, 2024, onwards, with the ratio gradually increasing to 20.82 by August 31, 2024. The interest coverage ratio further improved, reaching 44.29 by February 28, 2025, suggesting a healthier financial position in terms of meeting interest obligations.
In conclusion, the analysis of Micron Technology Inc's interest coverage ratio reflects fluctuations and periods of financial strain, followed by a recovery in the company's ability to cover its interest expenses in more recent periods. Investors and stakeholders should closely monitor the company's financial performance to ensure sustainable improvement in its interest coverage ratio.
Peer comparison
Feb 28, 2025