Amgen Inc. (NASDAQ:AMGN)

Debt to Equity Ratio

The debt to equity ratio exhibits a significant increase early in the period, rising from 3.5 to a peak of 40.23 by March 31, 2022. Following this spike, the ratio declines sharply to 15.1 by June 30, 2022, and continues to decrease gradually through subsequent quarters. From the March 31, 2023 value of 11.52, it generally trends downward with some fluctuations, reaching 5.67 by September 30, 2025. This pattern suggests an initial increase in leverage followed by progressive deleveraging efforts over the examined timeframe.

Debt to Capital Ratio

The debt to capital ratio starts at 0.78 and steadily increases to 0.98 by the first quarter of 2022, indicating a higher reliance on debt financing. Afterward, the ratio stabilizes around 0.9 to 0.93, with minor fluctuations observed, and gradually trends downward toward 0.85 by September 30, 2025. This suggests a moderate reduction in the proportion of debt in the capital structure in later periods.

Debt to Assets Ratio

This ratio exhibits a moderate increase from 0.52 initially to around 0.62 by March and June 2022. It remains relatively stable between 0.60 and 0.69 in the subsequent quarters, with a slight downward trend toward 0.61 by September 30, 2025. This indicates a consistent, albeit slightly declining, share of debt financing relative to total assets over time.

Financial Leverage

Financial leverage sees a dramatic rise early in the period, from 6.7 up to an exceptionally high 64.62 by March 31, 2022. This spike coincides with the sharp increase observed in the debt to equity ratio. Subsequently, leverage normalizes, falling to around 24.51 by June 30, 2022, and gradually decreasing with fluctuations to 9.37 by September 30, 2025. This trend reflects a period of considerable leverage expansion followed by consolidation and reduction.

Interest Coverage Ratio

The interest coverage ratio starts at 7.64 and declines moderately through 2021 and the first half of 2022, dropping to 6.4 in March 2022. The ratio continues a downward trajectory, reaching a low point of approximately 2.1 by June 30, 2024. From this point, a modest recovery is observed, with the ratio increasing to 3.89 by September 30, 2025. This pattern suggests increased difficulty covering interest expenses during the middle of the period, followed by gradual improvement in coverage capacity.

Total Debt

The total debt exhibited an overall increasing trend from March 31, 2021, through December 31, 2021, rising from $32.7 billion to $38.9 billion. This upward movement continued sharply in early 2023, peaking at approximately $64.6 billion by December 31, 2023. Subsequently, total debt showed a gradual decline through the quarters of 2024 and into 2025, reducing to about $54.6 billion by September 30, 2025. The data reflects a pattern of significant debt accumulation followed by progressive deleveraging in later periods.

Stockholders’ Equity

Stockholders’ equity declined markedly from $9.3 billion in March 2021 to a low of $0.9 billion by March 2022, indicating a substantial erosion of equity within one year. However, from mid-2022 onwards, equity began recovering steadily, reaching around $7.7 billion by September 2024. A degree of volatility is observed in this recovery phase but overall equity maintains an upward trajectory toward the end of the series, reaching $9.6 billion by September 2025.

Debt to Equity Ratio

The debt to equity ratio experienced significant volatility, reflecting the shifts in debt and equity. It escalated sharply from 3.5 in March 2021 to a peak of 40.23 in March 2022. This extreme ratio aligns with the period when equity was severely diminished and debt was high, highlighting increased financial leverage and risk. Following this peak, the ratio steadily decreased, falling to 5.67 by September 2025, indicative of a deleveraging trend facilitated by both declining debt levels and recovering equity base. The ratio's trend mirrors the company’s efforts to rebalance its financial structure after a period of heightened leverage.

Overall Insights

The financial trends suggest a phase of heightened borrowing culminating in early 2023 which coincided with a significant reduction in equity, possibly reflecting operational challenges or strategic investments funded by debt. Recovery in equity and a reduction in debt ratios after this period point to active management of capital structure and risk mitigation. The gradual improvement in the debt to equity ratio toward the later quarters implies enhanced financial stability and a focus on strengthening shareholder value through equity growth and debt repayment.

The analysis of the debt and capital structure over the observed periods reveals several notable trends and changes in the company's financial leverage.

Total Debt

Total debt exhibited relative stability during the initial quarters of 2021, fluctuating around US$32,000 million to US$38,000 million. Beginning in early 2023, there was a marked increase, peaking above US$64,000 million by the fourth quarter of 2023. Subsequently, total debt displayed a gradual but consistent decline through to the third quarter of 2025, falling below US$55,000 million.

Total Capital

Total capital initially varied between approximately US$40,000 million and US$46,000 million in 2021 and 2022, with a noticeable surge starting in the first quarter of 2023, reaching a maximum of over US$70,000 million by the end of 2023. Following this peak, total capital experienced a downward trend, settling in the US$63,000 to US$64,000 million range by late 2025.

Debt to Capital Ratio

The debt to capital ratio demonstrated a rising trend from 0.78 at the start of 2021 to a high of 0.98 in the first quarter of 2022, indicating an increasing reliance on debt financing relative to total capital during this period. From 2022 onward, this ratio generally stabilized around the 0.9 mark, with minor fluctuations. In the latter periods of observation, particularly toward the end of 2025, the ratio declined to approximately 0.85, suggesting a moderate reduction in leverage.

Overall, the company experienced a significant elevation in both total debt and capital during early 2023, which positively impacted the scale of its capital base but also sustained a high leverage level. The subsequent period showed a strategic deleveraging approach, reflected in the progressive reduction of total debt and a decline in the debt to capital ratio, improving the balance between equity and debt financing. Despite this improvement, the company's leverage remains relatively high, consistently above 0.85, indicating a continued preference for debt within its capital structure.

The financial data over multiple quarters shows notable dynamics in the company's debt and asset structure, reflecting shifts in its leverage and asset base management.

Total Debt

The total debt exhibits fluctuations with a general upward trajectory through the early quarters, starting around 32,685 million USD at the end of March 2021 and rising to peaks close to 64,613 million USD by December 2023. After this peak, total debt slightly declined and stabilized in the range of approximately 54,587 to 64,020 million USD in the subsequent quarters, indicating some debt reduction or payoff efforts in the latest periods.

Total Assets

Total assets display a moderate variability, initially decreasing from approximately 62,539 million USD at March 2021 to a low of about 59,196 million USD by March 2022. Subsequently, the assets generally increased, reaching a peak around 97,154 million USD at December 2023. Post-peak, asset values mostly stabilized near 90,000 million USD with slight fluctuations, suggesting relatively stable asset management or investment activities over the recent quarters.

Debt to Assets Ratio

The debt to assets ratio shows a consistent rising trend from about 0.52 in early 2021 to a high near 0.69 by late 2023. This indicates a growing reliance on debt financing relative to assets during this period. In later quarters, the ratio mildly decreases yet remains elevated around 0.61 by September 2025. This pattern points to a high leverage level sustained over time, with a recent tempering in leverage possibly attributable to the observed reductions in total debt or moderations in asset base growth.

Overall, the data reflects a substantial increase in both debt and asset size leading up to late 2023, followed by a stabilization phase where debt appears to be slightly reduced and asset levels maintained. The elevated debt to assets ratio remains a critical consideration, implying significant leverage that may impact financial risk and flexibility.

The analysis of the quarterly financial metrics over the observed periods reveals notable fluctuations in the total assets, stockholders’ equity, and financial leverage ratios.

Total Assets

Total assets demonstrated variability with an initial decline from approximately 62.5 billion US dollars at the beginning of 2021 to near 59.2 billion US dollars by the first quarter of 2022. Subsequently, there was a consistent upward trend, peaking at over 97 billion US dollars by the end of 2023, indicating asset growth during this phase. However, from the start of 2024 through to the third quarter of 2025, total assets showed a slight decreasing trend, stabilizing around the 90 billion US dollars mark, suggesting a consolidation phase after significant asset expansion.

Stockholders’ Equity

Stockholders’ equity experienced a major contraction in early 2021 through early 2022, declining sharply from about 9.3 billion US dollars to under 1 billion US dollars by March 2022. This indicates a period of reduced net asset value attributable to shareholders or potential significant losses/restructuring events. Following this trough, equity increased steadily from mid-2022 through late 2023, reaching approximately 7.7 billion US dollars before another decline at the end of 2023. In 2024 and 2025, equity fluctuated but generally exhibited a recovery trend, rising to nearly 9.6 billion US dollars by late 2025. This suggests renewed strengthening of capital base and possible improved profitability or equity financing measures.

Financial Leverage Ratio

The financial leverage ratio, which reflects the extent of debt financing relative to equity, exhibited a dramatic peak in early 2022, soaring to an extreme high above 64 times. This corresponds with the sharp equity reduction in the same period, implying a temporary imbalance with high indebtedness relative to equity. After this peak, the leverage ratio progressively decreased over the subsequent periods, indicating ongoing reductions in reliance on debt or recovery of equity capital. From mid-2022 onward, the ratio steadily moved downward to below 10 times by the third quarter of 2025, showing improved financial stability and reduced risk related to leverage.

Earnings before interest and tax (EBIT)

The EBIT exhibited notable fluctuations throughout the observed periods. Initially, it started at 2,142 million USD in the first quarter of 2021 and experienced a significant decline to 839 million USD in the following quarter. Subsequently, the EBIT rose strongly, reaching peaks above 2,400 million USD during the third and fourth quarters of 2021. In 2022, the EBIT remained somewhat variable, with a lower performance around the mid-year but again peaking near 2,760 million USD in the third quarter. The first quarter of 2023 demonstrated a substantial increase, attaining the highest level in the series at 3,985 million USD, before dipping and fluctuating throughout the remainder of 2023 and early 2024. Towards the end of 2024 and into 2025, a pattern of volatility continued, with EBIT values varying widely, including a low of 756 million USD and a high surpassing 4,600 million USD. This volatility suggests periods of operational challenges and recoveries, potentially influenced by market conditions or internal factors.

Interest expense, net

Interest expense showed a consistent upward trend over the quarters. Starting at 285 million USD in the first quarter of 2021, it rose steadily each quarter, peaking at 821 million USD by the end of 2023. Although slight decreases are observed in some quarters of 2024 and 2025, the overall pattern indicates an increased financial cost burden over time. The steady rise in interest expense could reflect increased debt levels or higher borrowing costs, contributing to pressure on the company's financial leverage.

Interest coverage ratio

The interest coverage ratio, a measure of the company's ability to meet interest obligations from EBIT, showed a declining trend over the period, despite some fluctuations. In early 2021, the ratio was robust at 7.64, indicating strong coverage. However, it declined gradually throughout the periods, falling to lows around 2.10 to 2.45 in 2024. Although there was some recovery in 2025, rising back to approximately 3.89, the ratio remained considerably below earlier levels. This decline reflects increased difficulty in servicing interest expenses relative to earnings, likely due to the combined effects of declining EBIT at times and rising interest costs. The weakening interest coverage could suggest an increased financial risk profile.