Tesla Inc (TSLA)
Interest coverage
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) (ttm) | US$ in thousands | 7,871,000 | 8,525,000 | 7,866,000 | 8,963,000 | 10,152,000 | 11,911,000 | 13,503,000 | 12,957,000 | 13,879,000 | 12,567,000 | 10,884,000 | 9,708,000 | 6,589,000 | 4,504,000 | 3,217,000 | 2,180,000 | 1,761,000 | 1,479,000 | 1,153,000 | 641,000 |
| Interest expense (ttm) | US$ in thousands | 350,000 | 315,000 | 261,000 | 203,000 | 156,000 | 128,000 | 143,000 | 159,000 | 191,000 | 229,000 | 302,000 | 333,000 | 371,000 | 546,000 | 583,000 | 678,000 | 748,000 | 672,000 | 694,000 | 696,000 |
| Interest coverage | 22.49 | 27.06 | 30.14 | 44.15 | 65.08 | 93.05 | 94.43 | 81.49 | 72.66 | 54.88 | 36.04 | 29.15 | 17.76 | 8.25 | 5.52 | 3.22 | 2.35 | 2.20 | 1.66 | 0.92 |
December 31, 2024 calculation
Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $7,871,000K ÷ $350,000K
= 22.49
The interest coverage ratio for Tesla Inc has shown a fluctuating trend over the periods analyzed. Starting at a low of 0.92 in March 2020, the ratio improved steadily, reaching 2.35 by December 2020, indicating the company's ability to cover its interest expenses was increasing. This positive trend continued into the following years, with significant improvements reflected in the ratios of 2021 and the first half of 2022, exceeding 29.15 by March 2022, signaling strong interest coverage.
However, from the second half of 2022 through to the end of 2024, the interest coverage ratio experienced a gradual decline. Despite peaking at 94.43 in June 2023, the ratio fell back to 22.49 by December 2024. This downward trend may raise concerns about Tesla Inc's capacity to cover its interest payments as effectively as in the previous periods. It is essential for stakeholders to monitor this ratio closely in the upcoming periods to assess the company's ability to meet its debt obligations with operating income.
Peer comparison
Dec 31, 2024