Super Micro Computer Inc (SMCI)
Debt-to-assets ratio
| Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 120,179 | 147,618 | 34,700 | 5,697 | 0 |
| Total assets | US$ in thousands | 3,674,730 | 3,205,080 | 2,241,960 | 1,918,650 | 1,682,590 |
| Debt-to-assets ratio | 0.03 | 0.05 | 0.02 | 0.00 | 0.00 |
June 30, 2023 calculation
Debt-to-assets ratio = Long-term debt ÷ Total assets
= $120,179K ÷ $3,674,730K
= 0.03
The debt-to-assets ratio for Super Micro Computer Inc over the past five years has shown fluctuations, indicating changes in the company's capital structure and financial leverage.
In Jun 30, 2019, the debt-to-assets ratio was 0.01, suggesting that only 1% of the company's assets were financed by debt. This indicates a conservative approach to leverage, with a majority of the assets being financed through equity.
By Jun 30, 2020, the ratio increased to 0.02, indicating a slight increase in the proportion of assets financed by debt. This could signify a strategic decision to use debt as a source of financing as the company sought to expand or invest in new projects.
In Jun 30, 2021, there was a notable surge in the debt-to-assets ratio to 0.04, representing a significant increase in the proportion of assets financed by debt. This could signal a shift in the company's capital structure towards more leverage, potentially to fund large-scale projects or acquisitions.
However, by Jun 30, 2022, there was a substantial decrease in the ratio to 0.19. This could be indicative of debt reduction or an increase in asset base through internal financing or equity injections. Such a sharp decrease in the ratio may be a result of repayment of debt or a decrease in the total assets.
Finally, the ratio decreased further to 0.08 by Jun 30, 2023, continuing the trend of decreasing leverage. This could suggest a deliberate effort by the company to reduce its reliance on debt financing and strengthen its financial position.
In conclusion, the fluctuation in Super Micro Computer Inc's debt-to-assets ratio over the past five years indicates changes in the company's financing strategy, reflecting both conservative and more leveraged approaches. It is essential to closely monitor this ratio to assess the company's risk exposure and financial stability.
Peer comparison
Jun 30, 2023