NVIDIA Corporation (NVDA)
Interest coverage
| Jan 31, 2025 | Jan 31, 2024 | Jan 28, 2024 | Jan 31, 2023 | Jan 29, 2023 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 84,273,000 | 34,075,000 | 34,075,000 | 4,443,000 | 4,443,000 |
| Interest expense | US$ in thousands | 247,000 | 257,000 | 257,000 | 262,000 | 262,000 |
| Interest coverage | 341.19 | 132.59 | 132.59 | 16.96 | 16.96 |
January 31, 2025 calculation
Interest coverage = EBIT ÷ Interest expense
= $84,273,000K ÷ $247,000K
= 341.19
NVIDIA Corporation's interest coverage ratio has shown a positive trend in recent years, indicating the company's ability to comfortably meet its interest obligations. The interest coverage ratio has increased significantly from 16.96 in January 2023 to 341.19 in January 2025. This improvement suggests that NVIDIA's earnings before interest and taxes (EBIT) are substantially higher than its interest expenses, providing a strong buffer to cover interest payments.
A high interest coverage ratio is generally considered a positive sign by investors and lenders, as it indicates that the company is financially sound and less risky in terms of its ability to manage debt. NVIDIA's interest coverage ratio of 341.19 in January 2025 reflects a robust financial position and a strong ability to service its debt obligations while maintaining profitability.
Overall, the upward trend in NVIDIA's interest coverage ratio demonstrates its improving financial health and efficient management of debt, which bodes well for the company's long-term sustainability and growth potential.
Peer comparison
Jan 31, 2025