Western Digital Corporation (WDC)

Interest coverage

		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	Dec 31, 2019	Sep 30, 2019
Earnings before interest and tax (EBIT) (ttm)	US$ in thousands	-233,000	-1,090,000	-1,825,000	-1,986,000	-1,248,000	-21,000	765,000	1,799,000	2,427,000	2,517,000	2,510,000	1,954,000	1,253,000	849,000	664,000	563,000	367,000	-262,000	-766,000	-632,000
Interest expense (ttm)	US$ in thousands	417,000	403,000	375,000	340,000	312,000	298,000	293,000	296,000	304,000	309,000	315,000	320,000	326,000	333,000	351,000	375,000	413,000	443,000	462,000	475,000
Interest coverage		-0.56	-2.70	-4.87	-5.84	-4.00	-0.07	2.61	6.08	7.98	8.15	7.97	6.11	3.84	2.55	1.89	1.50	0.89	-0.59	-1.66	-1.33

June 30, 2024 calculation

Interest coverage = EBIT (ttm) ÷ Interest expense (ttm)
= $-233,000K ÷ $417,000K
= -0.56

The interest coverage ratio for Western Digital Corporation has shown significant fluctuations over the past few quarters. The ratio has been negative in several periods, indicating that the company's operating income was insufficient to cover its interest expenses during those times. This is a concerning trend as negative interest coverage raises questions about the company's ability to meet its debt obligations.

In more recent quarters, the interest coverage ratio has improved and turned positive, suggesting that the company's operating income has become more sufficient to cover its interest expenses. However, the ratio remains relatively low, indicating that Western Digital Corporation still has a moderate level of financial risk in terms of servicing its debt.

Overall, continuous monitoring of Western Digital Corporation's interest coverage ratio is crucial to assess the company's ability to handle its debt obligations effectively and ensure financial stability in the long term.