PDF Solutions Inc (PDFS)
Interest coverage
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 935 | -151 | -2,092 | -15,817 | -18,060 |
| Interest expense | US$ in thousands | 5,644 | 5,020 | 2,562 | 683 | 1,269 |
| Interest coverage | 0.17 | -0.03 | -0.82 | -23.16 | -14.23 |
December 31, 2024 calculation
Interest coverage = EBIT ÷ Interest expense
= $935K ÷ $5,644K
= 0.17
The interest coverage ratio of PDF Solutions Inc has significantly deteriorated over the years, indicating a concerning trend. In December 2020, the interest coverage was at a negative value of -14.23, which worsened to -23.16 by December 2021. The ratio further plunged to -0.82 in December 2022, signaling that the company's operating income was insufficient to cover its interest expenses.
By December 2023, the interest coverage ratio deteriorated even more, hitting a low point of -0.03. This suggests that the company was barely able to cover its interest obligations with its operating income. However, there was a slight improvement by December 2024, with the ratio increasing to 0.17.
Overall, the continuous negative values and the low ratios indicate that PDF Solutions Inc may be facing significant challenges in generating enough operating income to meet its interest payments, posing a risk in terms of financial stability and debt servicing capability. The company may need to carefully assess its financial strategies and operational efficiency to improve its interest coverage ratio in the future.
Peer comparison
Dec 31, 2024