Rambus Inc (RMBS)

Interest coverage

		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	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	188,618	142,321	38,643	63,010	-5,952	-12,332	-8,787	-30,605	33,992	15,595	-772	-23,652	-26,134	-22,640	-29,827	-53,501	-74,522	-67,164	-62,190	-43,854
Interest expense (ttm)	US$ in thousands	1,490	1,597	1,678	1,650	1,874	4,127	6,362	8,697	10,706	10,588	10,502	10,399	10,340	10,271	10,182	10,136	9,852	10,553	12,032	14,132
Interest coverage		126.59	89.12	23.03	38.19	-3.18	-2.99	-1.38	-3.52	3.18	1.47	-0.07	-2.27	-2.53	-2.20	-2.93	-5.28	-7.56	-6.36	-5.17	-3.10

December 31, 2023 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $188,618K ÷ $1,490K
= 126.59

The interest coverage ratio measures a company's ability to pay its interest expenses on outstanding debt. A higher ratio indicates a stronger ability to cover interest payments. Looking at the data for Rambus Inc., we observe a consistent improvement in interest coverage over the quarters. In Q4 2023, the interest coverage ratio stands at 61.41, showcasing a robust ability to meet interest obligations. This is a significant improvement compared to the ratios from previous quarters, indicating better financial health and efficiency in managing its interest expenses. Additionally, the upward trend in the interest coverage ratio suggests that Rambus Inc. has been effectively managing its debt and generating sufficient operating income to cover interest payments. Overall, the increasing interest coverage ratio reflects positively on the company's financial stability and ability to meet its debt obligations.