Analysis of Solvency Ratios
Quarterly Data
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
Solvency Ratios (Summary)
AppLovin Corp., solvency ratios (quarterly data)
Based on: 10-Q (reporting date: 2026-06-30), 10-Q (reporting date: 2026-03-31), 10-K (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31).
The solvency profile of the organization underwent a period of significant volatility characterized by an increase in leverage through early 2025, followed by a substantial deleveraging phase. While capital structure ratios reached peak risk levels in the first quarter of 2025, the simultaneous and exponential growth in interest coverage suggests a dramatic improvement in operational profitability and the capacity to service debt obligations.
- Debt to Equity and Financial Leverage
- These metrics exhibited a strong positive correlation, both peaking in March 2025. Debt to equity rose from 1.60 in March 2022 to a high of 6.45 in March 2025, while financial leverage spiked from 3.06 to 9.92 over the same period. Following this peak, a sharp corrective trend is observed, with debt to equity falling to 1.11 and financial leverage reducing to 2.61 by June 2026, indicating a strategic shift toward equity-based financing or significant debt repayment.
- Debt to Capital and Debt to Assets
- The debt to capital ratio remained more stable than equity-based metrics but still followed a similar trajectory, peaking at 0.87 in March 2025 before declining to 0.53 by June 2026. Similarly, debt to assets increased from 0.52 in March 2022 to a peak of 0.67 in March 2024, before consistently trending downward to 0.43 by the end of the period. This suggests that a larger proportion of the asset base is now funded by internal accruals or equity rather than borrowed funds.
- Interest Coverage
- The most notable trend is the exponential improvement in interest coverage. Starting from a marginal 0.02 in March 2022 and dipping into negative territory (-0.19) in December 2022, the ratio grew consistently and aggressively. By June 2026, the ratio reached 26.42. This trajectory indicates that while the company increased its debt load between 2023 and 2025, the growth in earnings far outpaced the cost of that debt, effectively neutralizing the solvency risk associated with higher leverage.
In summary, the period analyzed shows a transition from a high-risk, highly leveraged position in early 2025 to a robust solvency position by mid-2026. The divergence between the peaking leverage ratios and the surging interest coverage ratio implies that the increased debt was likely utilized to fuel growth that generated substantial returns, allowing for the subsequent rapid reduction of debt levels.
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Debt Ratios
Coverage Ratios
Debt to Equity
AppLovin Corp., debt to equity calculation (quarterly data)
| Jun 30, 2026 | Mar 31, 2026 | Dec 31, 2025 | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||
| Short-term debt | —) | —) | —) | —) | —) | 200,000) | —) | 35,563) | 35,563) | 35,563) | 215,000) | 215,000) | 33,310) | 33,310) | 33,310) | 33,310) | 33,310) | 29,560) | ||||||
| Long-term debt | 3,515,072) | 3,514,022) | 3,512,987) | 3,511,965) | 3,510,958) | 3,509,964) | 3,508,983) | 3,474,456) | 3,482,166) | 3,489,891) | 2,905,906) | 2,912,302) | 3,166,759) | 3,172,563) | 3,178,412) | 3,184,221) | 3,190,047) | 3,195,919) | ||||||
| Total debt | 3,515,072) | 3,514,022) | 3,512,987) | 3,511,965) | 3,510,958) | 3,709,964) | 3,508,983) | 3,510,019) | 3,517,729) | 3,525,454) | 3,120,906) | 3,127,302) | 3,200,069) | 3,205,873) | 3,211,722) | 3,217,531) | 3,223,357) | 3,225,479) | ||||||
| Stockholders’ equity (deficit) | 3,163,016) | 2,363,483) | 2,134,671) | 1,473,920) | 1,167,127) | 575,421) | 1,089,818) | 938,206) | 814,836) | 760,204) | 1,256,329) | 1,095,790) | 1,517,400) | 1,898,580) | 1,902,677) | 1,881,902) | 1,907,175) | 2,012,295) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to equity1 | 1.11 | 1.49 | 1.65 | 2.38 | 3.01 | 6.45 | 3.22 | 3.74 | 4.32 | 4.64 | 2.48 | 2.85 | 2.11 | 1.69 | 1.69 | 1.71 | 1.69 | 1.60 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Equity, Competitors2 | ||||||||||||||||||||||||
| Accenture PLC | 0.16 | 0.17 | 0.17 | 0.17 | 0.18 | 0.18 | 0.04 | 0.06 | 0.01 | 0.01 | 0.01 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | ||||||
| Adobe Inc. | 0.58 | 0.54 | 0.53 | 0.53 | 0.54 | 0.47 | 0.40 | 0.39 | 0.38 | 0.24 | 0.22 | 0.23 | 0.24 | 0.26 | 0.29 | 0.29 | 0.30 | 0.30 | ||||||
| Cadence Design Systems Inc. | 0.36 | 0.44 | 0.45 | 0.48 | 0.49 | 0.52 | 0.53 | 0.62 | 0.32 | 0.18 | 0.19 | 0.21 | 0.22 | 0.23 | 0.27 | 0.29 | 0.13 | 0.13 | ||||||
| CrowdStrike Holdings Inc. | 0.20 | 0.22 | 0.23 | 0.24 | 0.26 | 0.29 | 0.32 | 0.37 | 0.40 | 0.46 | 0.51 | 0.56 | 0.60 | 0.67 | 0.72 | 0.78 | 0.82 | 0.87 | ||||||
| Datadog Inc. | — | 0.25 | 0.26 | 0.29 | 0.31 | 0.55 | 0.59 | 0.28 | 0.31 | 0.34 | 0.37 | 0.41 | 0.45 | 0.49 | 0.52 | 0.57 | 0.61 | 0.66 | ||||||
| International Business Machines Corp. | 1.80 | 2.01 | 1.88 | 2.26 | 2.33 | 2.35 | 2.01 | 2.31 | 2.35 | 2.56 | 2.51 | 2.39 | 2.59 | 2.72 | 2.32 | 2.53 | 2.59 | 2.85 | ||||||
| Intuit Inc. | 0.32 | 0.32 | 0.30 | 0.32 | 0.35 | 0.34 | 0.33 | 0.32 | 0.35 | 0.35 | 0.35 | 0.38 | 0.45 | 0.43 | 0.42 | 0.40 | 0.43 | 0.21 | ||||||
| Microsoft Corp. | 0.10 | 0.12 | 0.13 | 0.13 | 0.15 | 0.16 | 0.19 | 0.26 | 0.31 | 0.32 | 0.23 | 0.25 | 0.26 | 0.28 | 0.30 | 0.31 | 0.33 | 0.35 | ||||||
| Oracle Corp. | 3.61 | 3.78 | 4.53 | 5.75 | 6.45 | 7.81 | 9.98 | 15.65 | 22.97 | 37.53 | 84.33 | — | — | — | — | — | — | — | ||||||
| Palantir Technologies Inc. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | ||||||
| Palo Alto Networks Inc. | 0.00 | 0.00 | 0.00 | 0.05 | 0.08 | 0.11 | 0.19 | 0.26 | 0.42 | 0.90 | 1.14 | 2.99 | 5.05 | 7.24 | 17.51 | 10.89 | 31.19 | 7.08 | ||||||
| Salesforce Inc. | 0.14 | 0.14 | 0.14 | 0.14 | 0.15 | 0.16 | 0.16 | 0.16 | 0.16 | 0.17 | 0.18 | 0.18 | 0.18 | 0.18 | 0.18 | 0.19 | 0.24 | 0.06 | ||||||
| ServiceNow Inc. | 0.60 | 0.13 | 0.12 | 0.13 | 0.14 | 0.15 | 0.15 | 0.16 | 0.17 | 0.18 | 0.20 | 0.21 | 0.21 | 0.27 | 0.30 | 0.33 | 0.35 | 0.39 | ||||||
| Synopsys Inc. | 0.33 | 0.33 | 0.48 | 0.52 | 1.01 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | ||||||
| Workday Inc. | 0.33 | 0.33 | 0.33 | 0.35 | 0.36 | 0.37 | 0.37 | 0.45 | 0.47 | 0.50 | 0.53 | 0.55 | 0.80 | 0.86 | 0.41 | 0.44 | 0.48 | 0.55 | ||||||
Based on: 10-Q (reporting date: 2026-06-30), 10-Q (reporting date: 2026-03-31), 10-K (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31).
1 Q2 2026 Calculation
Debt to equity = Total debt ÷ Stockholders’ equity (deficit)
= 3,515,072 ÷ 3,163,016 = 1.11
2 Click competitor name to see calculations.
The solvency profile exhibits a period of significant volatility characterized by a sustained increase in financial leverage through early 2025, followed by a rapid recovery in equity and a corresponding reduction in the debt-to-equity ratio.
- Total Debt Trends
- Total debt remained relatively stable at approximately 3.2 billion USD throughout 2022. A moderate increase occurred in early 2024, with obligations rising to 3.5 billion USD. The debt load reached a peak of 3.71 billion USD in March 2025 before stabilizing around 3.52 billion USD through June 2026.
- Stockholders' Equity Fluctuations
- A significant downward trend in stockholders' equity is observed starting from March 2022, where equity stood at 2.01 billion USD. This value declined progressively, reaching a minimum of 575 million USD by March 2025. Following this trough, a substantial recovery is evident, with equity increasing sharply to 3.16 billion USD by June 2026.
- Debt to Equity Ratio Analysis
- The debt-to-equity ratio mirrors the divergence between rising debt and falling equity. Starting at 1.60 in March 2022, the ratio climbed steadily, surpassing 4.00 in early 2024 and peaking at 6.45 in March 2025. This indicates a period of heightened solvency risk and increased reliance on borrowed capital. However, the ratio declined precipitously thereafter, ending at 1.11 in June 2026, which represents a return to a more balanced capital structure.
Overall, the financial data reveals a cyclical movement in solvency. The period between March 2023 and March 2025 was marked by deteriorating equity levels and peaking leverage. The subsequent period from June 2025 to June 2026 shows a strong rebuild of the equity base, effectively lowering the solvency risk and improving the overall financial stability of the entity.
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Debt to Capital
AppLovin Corp., debt to capital calculation (quarterly data)
| Jun 30, 2026 | Mar 31, 2026 | Dec 31, 2025 | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||
| Short-term debt | —) | —) | —) | —) | —) | 200,000) | —) | 35,563) | 35,563) | 35,563) | 215,000) | 215,000) | 33,310) | 33,310) | 33,310) | 33,310) | 33,310) | 29,560) | ||||||
| Long-term debt | 3,515,072) | 3,514,022) | 3,512,987) | 3,511,965) | 3,510,958) | 3,509,964) | 3,508,983) | 3,474,456) | 3,482,166) | 3,489,891) | 2,905,906) | 2,912,302) | 3,166,759) | 3,172,563) | 3,178,412) | 3,184,221) | 3,190,047) | 3,195,919) | ||||||
| Total debt | 3,515,072) | 3,514,022) | 3,512,987) | 3,511,965) | 3,510,958) | 3,709,964) | 3,508,983) | 3,510,019) | 3,517,729) | 3,525,454) | 3,120,906) | 3,127,302) | 3,200,069) | 3,205,873) | 3,211,722) | 3,217,531) | 3,223,357) | 3,225,479) | ||||||
| Stockholders’ equity (deficit) | 3,163,016) | 2,363,483) | 2,134,671) | 1,473,920) | 1,167,127) | 575,421) | 1,089,818) | 938,206) | 814,836) | 760,204) | 1,256,329) | 1,095,790) | 1,517,400) | 1,898,580) | 1,902,677) | 1,881,902) | 1,907,175) | 2,012,295) | ||||||
| Total capital | 6,678,088) | 5,877,505) | 5,647,658) | 4,985,885) | 4,678,085) | 4,285,385) | 4,598,801) | 4,448,225) | 4,332,565) | 4,285,658) | 4,377,235) | 4,223,092) | 4,717,469) | 5,104,453) | 5,114,399) | 5,099,433) | 5,130,532) | 5,237,774) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to capital1 | 0.53 | 0.60 | 0.62 | 0.70 | 0.75 | 0.87 | 0.76 | 0.79 | 0.81 | 0.82 | 0.71 | 0.74 | 0.68 | 0.63 | 0.63 | 0.63 | 0.63 | 0.62 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Capital, Competitors2 | ||||||||||||||||||||||||
| Accenture PLC | 0.14 | 0.14 | 0.14 | 0.14 | 0.15 | 0.15 | 0.03 | 0.06 | 0.01 | 0.01 | 0.01 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | ||||||
| Adobe Inc. | 0.37 | 0.35 | 0.35 | 0.35 | 0.35 | 0.32 | 0.29 | 0.28 | 0.27 | 0.19 | 0.18 | 0.19 | 0.20 | 0.20 | 0.23 | 0.22 | 0.23 | 0.23 | ||||||
| Cadence Design Systems Inc. | 0.27 | 0.31 | 0.31 | 0.32 | 0.33 | 0.34 | 0.35 | 0.38 | 0.24 | 0.15 | 0.16 | 0.17 | 0.18 | 0.19 | 0.21 | 0.23 | 0.12 | 0.11 | ||||||
| CrowdStrike Holdings Inc. | 0.17 | 0.18 | 0.18 | 0.20 | 0.21 | 0.23 | 0.24 | 0.27 | 0.29 | 0.32 | 0.34 | 0.36 | 0.38 | 0.40 | 0.42 | 0.44 | 0.45 | 0.47 | ||||||
| Datadog Inc. | — | 0.20 | 0.21 | 0.22 | 0.23 | 0.36 | 0.37 | 0.22 | 0.24 | 0.25 | 0.27 | 0.29 | 0.31 | 0.33 | 0.34 | 0.36 | 0.38 | 0.40 | ||||||
| International Business Machines Corp. | 0.64 | 0.67 | 0.65 | 0.69 | 0.70 | 0.70 | 0.67 | 0.70 | 0.70 | 0.72 | 0.72 | 0.71 | 0.72 | 0.73 | 0.70 | 0.72 | 0.72 | 0.74 | ||||||
| Intuit Inc. | 0.24 | 0.24 | 0.23 | 0.24 | 0.26 | 0.25 | 0.25 | 0.24 | 0.26 | 0.26 | 0.26 | 0.27 | 0.31 | 0.30 | 0.30 | 0.29 | 0.30 | 0.17 | ||||||
| Microsoft Corp. | 0.09 | 0.11 | 0.11 | 0.12 | 0.13 | 0.14 | 0.16 | 0.21 | 0.24 | 0.24 | 0.19 | 0.20 | 0.21 | 0.22 | 0.23 | 0.23 | 0.25 | 0.26 | ||||||
| Oracle Corp. | 0.78 | 0.79 | 0.82 | 0.85 | 0.87 | 0.89 | 0.91 | 0.94 | 0.96 | 0.97 | 0.99 | 1.03 | 1.05 | 1.07 | 1.09 | 1.12 | 1.15 | 1.02 | ||||||
| Palantir Technologies Inc. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | ||||||
| Palo Alto Networks Inc. | 0.00 | 0.00 | 0.00 | 0.05 | 0.08 | 0.10 | 0.16 | 0.21 | 0.29 | 0.47 | 0.53 | 0.75 | 0.83 | 0.88 | 0.95 | 0.92 | 0.97 | 0.88 | ||||||
| Salesforce Inc. | 0.12 | 0.12 | 0.12 | 0.13 | 0.13 | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 | 0.15 | 0.15 | 0.15 | 0.15 | 0.15 | 0.16 | 0.19 | 0.06 | ||||||
| ServiceNow Inc. | 0.38 | 0.11 | 0.10 | 0.12 | 0.12 | 0.13 | 0.13 | 0.14 | 0.15 | 0.16 | 0.16 | 0.17 | 0.18 | 0.21 | 0.23 | 0.25 | 0.26 | 0.28 | ||||||
| Synopsys Inc. | 0.25 | 0.25 | 0.32 | 0.34 | 0.50 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | ||||||
| Workday Inc. | 0.25 | 0.25 | 0.25 | 0.26 | 0.26 | 0.27 | 0.27 | 0.31 | 0.32 | 0.33 | 0.35 | 0.35 | 0.45 | 0.46 | 0.29 | 0.30 | 0.32 | 0.35 | ||||||
Based on: 10-Q (reporting date: 2026-06-30), 10-Q (reporting date: 2026-03-31), 10-K (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31).
1 Q2 2026 Calculation
Debt to capital = Total debt ÷ Total capital
= 3,515,072 ÷ 6,678,088 = 0.53
2 Click competitor name to see calculations.
The solvency profile exhibits a distinct cyclical pattern characterized by a period of increasing leverage followed by a significant improvement in the capital structure. The debt-to-capital ratio remained relatively stable in the initial phases before experiencing a sharp ascent that peaked in early 2025, subsequently declining to its lowest observed level by mid-2026.
- Total Debt Analysis
- Total debt showed a gradual decline from March 2022 through December 2023, moving from approximately $3.23 billion to $3.12 billion. A notable increase occurred in March 2024, raising the debt level to $3.53 billion. After a secondary peak of $3.71 billion in March 2025, the debt load stabilized and remained consistent at approximately $3.51 billion through June 2026.
- Total Capital Trends
- Total capital underwent a period of contraction from March 2022 ($5.24 billion) to March 2024 ($4.29 billion). This downward trend reversed in the second half of 2025, initiating a period of aggressive capital expansion. Capital levels rose steadily from $4.68 billion in June 2025 to a period high of $6.68 billion by June 2026.
- Debt to Capital Ratio Interpretation
- The ratio remained constant at 0.62 to 0.63 for the first year of the period. A trend of increasing leverage began in June 2023, with the ratio climbing to 0.82 by March 2024. The peak leverage of 0.87 was reached in March 2025, coinciding with the highest point of total debt and a relative contraction in capital. Following this peak, the ratio entered a sustained decline, reaching 0.53 by June 2026. This final reduction is primarily attributed to the substantial growth in total capital while total debt remained flat, indicating a strengthened solvency position and a reduced reliance on debt financing.
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Debt to Assets
AppLovin Corp., debt to assets calculation (quarterly data)
| Jun 30, 2026 | Mar 31, 2026 | Dec 31, 2025 | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||
| Short-term debt | —) | —) | —) | —) | —) | 200,000) | —) | 35,563) | 35,563) | 35,563) | 215,000) | 215,000) | 33,310) | 33,310) | 33,310) | 33,310) | 33,310) | 29,560) | ||||||
| Long-term debt | 3,515,072) | 3,514,022) | 3,512,987) | 3,511,965) | 3,510,958) | 3,509,964) | 3,508,983) | 3,474,456) | 3,482,166) | 3,489,891) | 2,905,906) | 2,912,302) | 3,166,759) | 3,172,563) | 3,178,412) | 3,184,221) | 3,190,047) | 3,195,919) | ||||||
| Total debt | 3,515,072) | 3,514,022) | 3,512,987) | 3,511,965) | 3,510,958) | 3,709,964) | 3,508,983) | 3,510,019) | 3,517,729) | 3,525,454) | 3,120,906) | 3,127,302) | 3,200,069) | 3,205,873) | 3,211,722) | 3,217,531) | 3,223,357) | 3,225,479) | ||||||
| Total assets | 8,269,131) | 7,707,705) | 7,259,610) | 6,343,035) | 5,959,497) | 5,706,701) | 5,869,259) | 5,442,484) | 5,269,466) | 5,262,517) | 5,359,187) | 5,005,228) | 5,482,120) | 5,915,840) | 5,847,846) | 5,805,398) | 5,930,828) | 6,167,193) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to assets1 | 0.43 | 0.46 | 0.48 | 0.55 | 0.59 | 0.65 | 0.60 | 0.64 | 0.67 | 0.67 | 0.58 | 0.62 | 0.58 | 0.54 | 0.55 | 0.55 | 0.54 | 0.52 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Assets, Competitors2 | ||||||||||||||||||||||||
| Accenture PLC | 0.08 | 0.08 | 0.08 | 0.08 | 0.09 | 0.09 | 0.02 | 0.03 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | ||||||
| Adobe Inc. | 0.22 | 0.21 | 0.21 | 0.22 | 0.22 | 0.21 | 0.19 | 0.19 | 0.19 | 0.13 | 0.12 | 0.12 | 0.13 | 0.14 | 0.15 | 0.15 | 0.16 | 0.16 | ||||||
| Cadence Design Systems Inc. | 0.21 | 0.24 | 0.24 | 0.26 | 0.26 | 0.27 | 0.28 | 0.31 | 0.19 | 0.11 | 0.11 | 0.12 | 0.13 | 0.13 | 0.15 | 0.16 | 0.08 | 0.08 | ||||||
| CrowdStrike Holdings Inc. | 0.08 | 0.09 | 0.09 | 0.10 | 0.10 | 0.11 | 0.11 | 0.13 | 0.13 | 0.14 | 0.15 | 0.17 | 0.18 | 0.19 | 0.20 | 0.22 | 0.24 | 0.26 | ||||||
| Datadog Inc. | — | 0.14 | 0.15 | 0.16 | 0.17 | 0.27 | 0.28 | 0.16 | 0.17 | 0.18 | 0.19 | 0.21 | 0.22 | 0.24 | 0.25 | 0.26 | 0.28 | 0.29 | ||||||
| International Business Machines Corp. | 0.41 | 0.42 | 0.40 | 0.43 | 0.43 | 0.43 | 0.40 | 0.42 | 0.42 | 0.43 | 0.42 | 0.43 | 0.43 | 0.44 | 0.40 | 0.40 | 0.39 | 0.41 | ||||||
| Intuit Inc. | 0.18 | 0.18 | 0.16 | 0.18 | 0.20 | 0.18 | 0.19 | 0.19 | 0.20 | 0.21 | 0.22 | 0.23 | 0.26 | 0.26 | 0.25 | 0.24 | 0.26 | 0.14 | ||||||
| Microsoft Corp. | 0.06 | 0.07 | 0.07 | 0.08 | 0.08 | 0.09 | 0.10 | 0.14 | 0.16 | 0.16 | 0.11 | 0.13 | 0.13 | 0.14 | 0.14 | 0.14 | 0.16 | 0.16 | ||||||
| Oracle Corp. | 0.53 | 0.51 | 0.55 | 0.60 | 0.60 | 0.59 | 0.62 | 0.64 | 0.66 | 0.65 | 0.67 | 0.70 | 0.71 | 0.70 | 0.69 | 0.72 | 0.73 | 0.67 | ||||||
| Palantir Technologies Inc. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | ||||||
| Palo Alto Networks Inc. | 0.00 | 0.00 | 0.00 | 0.02 | 0.03 | 0.03 | 0.05 | 0.06 | 0.10 | 0.13 | 0.14 | 0.26 | 0.28 | 0.29 | 0.30 | 0.33 | 0.35 | 0.35 | ||||||
| Salesforce Inc. | 0.09 | 0.09 | 0.08 | 0.09 | 0.09 | 0.10 | 0.09 | 0.10 | 0.10 | 0.10 | 0.11 | 0.12 | 0.11 | 0.11 | 0.11 | 0.12 | 0.15 | 0.04 | ||||||
| ServiceNow Inc. | 0.24 | 0.06 | 0.06 | 0.07 | 0.07 | 0.07 | 0.07 | 0.08 | 0.08 | 0.08 | 0.09 | 0.10 | 0.10 | 0.11 | 0.11 | 0.13 | 0.13 | 0.14 | ||||||
| Synopsys Inc. | 0.21 | 0.21 | 0.28 | 0.30 | 0.42 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | ||||||
| Workday Inc. | 0.17 | 0.17 | 0.17 | 0.18 | 0.18 | 0.19 | 0.18 | 0.21 | 0.22 | 0.22 | 0.22 | 0.24 | 0.31 | 0.32 | 0.18 | 0.20 | 0.20 | 0.22 | ||||||
Based on: 10-Q (reporting date: 2026-06-30), 10-Q (reporting date: 2026-03-31), 10-K (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31).
1 Q2 2026 Calculation
Debt to assets = Total debt ÷ Total assets
= 3,515,072 ÷ 8,269,131 = 0.43
2 Click competitor name to see calculations.
The solvency profile of the organization exhibits a distinct cyclical pattern between March 2022 and June 2026, characterized by an initial increase in financial leverage followed by a significant strengthening of the balance sheet.
- Debt to Assets Ratio Trends
- The debt to assets ratio experienced a gradual ascent from 0.52 in March 2022, reaching a peak of 0.67 during the first half of 2024. Following this peak, a consistent downward trajectory is observed, with the ratio declining to 0.43 by June 2026. This movement indicates a substantial improvement in the proportion of assets supporting the total debt obligations over the analyzed period.
- Total Debt Dynamics
- Total debt remained relatively stable near the 3.2 billion mark from March 2022 through December 2023. An upward shift occurred in the first quarter of 2024, where debt levels rose to approximately 3.5 billion, peaking at 3.7 billion in December 2024. From 2025 through June 2026, debt levels stabilized and remained largely consistent.
- Total Asset Evolution
- Total assets demonstrated significant volatility, declining from 6.1 billion in March 2022 to a trough of 5.0 billion in September 2023. A sustained growth phase followed, with assets increasing steadily to reach 8.2 billion by June 2026. The expansion of the asset base was the primary driver behind the reduction of the debt to assets ratio in the latter half of the analyzed timeline.
- Solvency Analysis
- The peak in leverage observed between late 2023 and early 2024 was the result of a contracting asset base coinciding with a subsequent increase in total debt. The subsequent improvement in the solvency ratio from 2024 to 2026 was not achieved through the repayment of principal debt, but rather through aggressive asset growth, which effectively lowered the debt-to-asset dependency.
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Financial Leverage
AppLovin Corp., financial leverage calculation (quarterly data)
| Jun 30, 2026 | Mar 31, 2026 | Dec 31, 2025 | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||
| Total assets | 8,269,131) | 7,707,705) | 7,259,610) | 6,343,035) | 5,959,497) | 5,706,701) | 5,869,259) | 5,442,484) | 5,269,466) | 5,262,517) | 5,359,187) | 5,005,228) | 5,482,120) | 5,915,840) | 5,847,846) | 5,805,398) | 5,930,828) | 6,167,193) | ||||||
| Stockholders’ equity (deficit) | 3,163,016) | 2,363,483) | 2,134,671) | 1,473,920) | 1,167,127) | 575,421) | 1,089,818) | 938,206) | 814,836) | 760,204) | 1,256,329) | 1,095,790) | 1,517,400) | 1,898,580) | 1,902,677) | 1,881,902) | 1,907,175) | 2,012,295) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Financial leverage1 | 2.61 | 3.26 | 3.40 | 4.30 | 5.11 | 9.92 | 5.39 | 5.80 | 6.47 | 6.92 | 4.27 | 4.57 | 3.61 | 3.12 | 3.07 | 3.08 | 3.11 | 3.06 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Financial Leverage, Competitors2 | ||||||||||||||||||||||||
| Accenture PLC | 2.15 | 2.10 | 2.10 | 2.07 | 2.05 | 2.05 | 1.98 | 1.95 | 1.89 | 1.93 | 1.99 | 1.98 | 2.01 | 2.05 | 2.14 | 2.16 | 2.16 | 2.15 | ||||||
| Adobe Inc. | 2.60 | 2.60 | 2.54 | 2.44 | 2.46 | 2.29 | 2.14 | 2.05 | 2.02 | 1.86 | 1.80 | 1.84 | 1.88 | 1.88 | 1.93 | 1.86 | 1.88 | 1.89 | ||||||
| Cadence Design Systems Inc. | 1.76 | 1.84 | 1.85 | 1.85 | 1.90 | 1.89 | 1.92 | 2.01 | 1.70 | 1.60 | 1.67 | 1.74 | 1.77 | 1.76 | 1.87 | 1.83 | 1.66 | 1.59 | ||||||
| CrowdStrike Holdings Inc. | 2.47 | 2.53 | 2.65 | 2.55 | 2.52 | 2.70 | 2.88 | 2.87 | 3.00 | 3.20 | 3.43 | 3.40 | 3.39 | 3.48 | 3.53 | 3.48 | 3.47 | 3.39 | ||||||
| Datadog Inc. | — | 1.74 | 1.78 | 1.76 | 1.82 | 2.06 | 2.13 | 1.76 | 1.83 | 1.88 | 1.94 | 1.96 | 2.01 | 2.08 | 2.13 | 2.17 | 2.18 | 2.26 | ||||||
| International Business Machines Corp. | 4.41 | 4.74 | 4.65 | 5.24 | 5.40 | 5.42 | 5.02 | 5.49 | 5.57 | 5.90 | 6.00 | 5.60 | 5.96 | 6.19 | 5.80 | 6.27 | 6.57 | 7.00 | ||||||
| Intuit Inc. | 1.80 | 1.72 | 1.88 | 1.82 | 1.77 | 1.83 | 1.74 | 1.68 | 1.76 | 1.68 | 1.61 | 1.64 | 1.72 | 1.69 | 1.69 | 1.68 | 1.69 | 1.53 | ||||||
| Microsoft Corp. | 1.70 | 1.75 | 1.80 | 1.75 | 1.76 | 1.82 | 1.91 | 1.91 | 1.97 | 2.02 | 2.00 | 1.95 | 1.99 | 2.07 | 2.19 | 2.12 | 2.13 | 2.21 | ||||||
| Oracle Corp. | 6.84 | 7.47 | 8.23 | 9.65 | 10.80 | 13.33 | 16.20 | 24.38 | 34.74 | 57.66 | 125.24 | — | — | — | — | — | — | — | ||||||
| Palantir Technologies Inc. | 1.19 | 1.21 | 1.20 | 1.23 | 1.24 | 1.24 | 1.27 | 1.28 | 1.28 | 1.27 | 1.30 | 1.31 | 1.35 | 1.35 | 1.35 | 1.39 | 1.40 | 1.40 | ||||||
| Palo Alto Networks Inc. | 2.66 | 2.72 | 3.01 | 3.04 | 3.29 | 3.45 | 3.87 | 4.01 | 4.20 | 6.82 | 8.29 | 11.50 | 18.06 | 24.69 | 58.35 | 32.88 | 88.29 | 20.09 | ||||||
| Salesforce Inc. | 1.59 | 1.63 | 1.68 | 1.56 | 1.60 | 1.61 | 1.67 | 1.57 | 1.59 | 1.63 | 1.69 | 1.55 | 1.57 | 1.58 | 1.64 | 1.53 | 1.60 | 1.52 | ||||||
| ServiceNow Inc. | 2.53 | 2.08 | 2.01 | 1.93 | 2.02 | 2.07 | 2.12 | 1.98 | 2.10 | 2.16 | 2.28 | 2.10 | 2.15 | 2.43 | 2.64 | 2.46 | 2.65 | 2.75 | ||||||
| Synopsys Inc. | 1.54 | 1.55 | 1.70 | 1.75 | 2.40 | 1.40 | 1.45 | 1.51 | 1.54 | 1.58 | 1.68 | 1.67 | 1.68 | 1.70 | 1.71 | 1.66 | 1.66 | 1.65 | ||||||
| Workday Inc. | 1.96 | 1.93 | 1.99 | 1.90 | 1.95 | 1.95 | 2.04 | 2.10 | 2.19 | 2.23 | 2.41 | 2.29 | 2.58 | 2.68 | 2.31 | 2.24 | 2.36 | 2.53 | ||||||
Based on: 10-Q (reporting date: 2026-06-30), 10-Q (reporting date: 2026-03-31), 10-K (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31).
1 Q2 2026 Calculation
Financial leverage = Total assets ÷ Stockholders’ equity (deficit)
= 8,269,131 ÷ 3,163,016 = 2.61
2 Click competitor name to see calculations.
The solvency profile exhibits a period of significant volatility in financial leverage, characterized by an acute increase in risk followed by a substantial deleveraging phase and balance sheet strengthening.
- Financial Leverage Trends
- The leverage ratio remained relatively stable between March 2022 and March 2023, fluctuating within a narrow range of 3.06 to 3.12. A sharp upward trajectory began in June 2023, leading to a peak ratio of 9.92 by March 31, 2025. Following this peak, a rapid decline is observed, with the ratio falling to 2.61 by June 30, 2026, indicating a transition from a high-risk leverage position to a more conservative capital structure.
- Equity Base Fluctuations
- Stockholders' equity experienced a prolonged contraction, falling from 2.01 billion in March 2022 to a minimum of 575.4 million in March 2025. This erosion of the equity base was the primary catalyst for the spike in financial leverage. However, a strong recovery phase occurred between June 2025 and June 2026, during which equity grew to 3.16 billion, exceeding the initial levels recorded at the start of the period.
- Asset Growth and Solvency Impact
- Total assets remained largely range-bound between 5.0 billion and 6.1 billion from early 2022 through early 2024. A sustained growth trend emerged in late 2024, with assets increasing to 8.27 billion by June 2026. The simultaneous expansion of the asset base and the recovery of stockholders' equity contributed to the marked improvement in the solvency ratio, resulting in the lowest leverage level of the entire period by mid-2026.
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Interest Coverage
AppLovin Corp., interest coverage calculation (quarterly data)
| Jun 30, 2026 | Mar 31, 2026 | Dec 31, 2025 | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||
| Net income (loss) attributable to AppLovin | 1,266,538) | 1,205,613) | 1,102,256) | 835,545) | 819,531) | 576,419) | 599,204) | 434,420) | 309,969) | 236,183) | 172,233) | 108,639) | 80,357) | (4,518) | (79,512) | 23,771) | (21,748) | (115,257) | ||||||
| Add: Net income attributable to noncontrolling interest | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | (109) | (51) | (41) | ||||||
| Less: Income (loss) from discontinued operations, net of income taxes | —) | —) | —) | —) | 47,675) | (147,119) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | ||||||
| Add: Income tax expense | 238,988) | 225,795) | 151,098) | 185,401) | 112,148) | 71,068) | (84,080) | 33,249) | 15,298) | 31,762) | 6,663) | 586) | 15,445) | 1,165) | 13,340) | (22,053) | 39,167) | (42,684) | ||||||
| Add: Interest expense | 51,156) | 51,159) | 51,290) | 51,429) | 51,409) | 52,888) | 94,199) | 75,213) | 74,666) | 74,182) | 71,584) | 78,583) | 50,987) | 74,511) | 54,722) | 48,627) | 36,505) | 32,009) | ||||||
| Earnings before interest and tax (EBIT) | 1,556,682) | 1,482,567) | 1,304,644) | 1,072,375) | 935,413) | 847,494) | 609,323) | 542,882) | 399,933) | 342,127) | 250,480) | 187,808) | 146,789) | 71,158) | (11,450) | 50,236) | 53,873) | (125,973) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Interest coverage1 | 26.42 | 23.36 | 20.09 | 13.86 | 10.72 | 8.08 | 5.95 | 5.19 | 3.95 | 3.37 | 2.38 | 1.52 | 1.12 | 0.76 | -0.19 | 0.25 | 0.19 | 0.02 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Interest Coverage, Competitors2 | ||||||||||||||||||||||||
| Accenture PLC | 40.77 | 39.97 | 45.94 | 57.86 | 80.38 | 135.71 | 165.48 | 175.20 | 175.18 | 168.23 | 193.31 | 220.23 | 212.89 | 217.31 | 195.34 | 188.01 | 133.08 | 133.32 | ||||||
| Adobe Inc. | 35.91 | 34.99 | 34.21 | 35.26 | 37.00 | 40.93 | 42.01 | 46.90 | 53.43 | 58.12 | 61.17 | 58.59 | 55.57 | 53.27 | 54.64 | 54.21 | 54.34 | 53.39 | ||||||
| Cadence Design Systems Inc. | 15.57 | 14.39 | 14.06 | 13.53 | 13.50 | 15.95 | 19.37 | 24.99 | 33.48 | 36.67 | 36.43 | 32.16 | 34.13 | 38.63 | 46.58 | 57.84 | 58.34 | 52.92 | ||||||
| CrowdStrike Holdings Inc. | -6.94 | -2.14 | 3.07 | 7.50 | 9.33 | 7.64 | 5.77 | 1.41 | -1.80 | -4.04 | -5.31 | -4.72 | -4.71 | -5.09 | -5.34 | -6.41 | -8.16 | -12.40 | ||||||
| Datadog Inc. | — | 14.75 | 12.49 | 12.47 | 15.42 | 22.90 | 29.85 | 37.27 | 33.23 | 24.08 | 10.56 | -1.85 | -5.72 | -4.15 | -1.30 | 0.81 | 1.72 | 1.24 | ||||||
| International Business Machines Corp. | 6.41 | 6.41 | 6.34 | 6.05 | 4.44 | 4.39 | 4.39 | 4.69 | 6.33 | 6.21 | 6.41 | 6.44 | 2.34 | 2.25 | 1.95 | 1.59 | 6.01 | 5.40 | ||||||
| Intuit Inc. | 23.55 | 22.15 | 20.57 | 18.45 | 16.48 | 15.76 | 15.67 | 15.74 | 14.07 | 13.20 | 13.05 | 14.66 | 16.17 | 19.99 | 32.38 | 55.36 | 62.71 | 93.29 | ||||||
| Oracle Corp. | 5.51 | 4.94 | 4.96 | 4.96 | 4.81 | 4.60 | 4.34 | 4.08 | 3.88 | 3.74 | 3.60 | 3.96 | 4.41 | 3.33 | 3.78 | 3.98 | 4.23 | 6.06 | ||||||
| Palantir Technologies Inc. | — | — | — | — | — | — | — | 3,786.90 | 499.52 | 149.97 | 69.33 | 34.43 | -5.32 | -49.82 | -87.97 | -176.15 | -201.09 | -194.27 | ||||||
| Palo Alto Networks Inc. | 2,071.33 | 911.61 | 532.90 | 427.74 | 269.85 | 163.77 | 120.07 | 72.96 | 46.08 | 35.96 | 21.82 | 10.40 | 4.05 | -1.99 | -6.56 | -4.28 | -3.42 | -2.65 | ||||||
| Salesforce Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Synopsys Inc. | 2.26 | 2.97 | 4.12 | 5.50 | 11.64 | 31.24 | 44.06 | 78.90 | 174.76 | 852.56 | — | — | — | — | — | — | — | — | ||||||
Based on: 10-Q (reporting date: 2026-06-30), 10-Q (reporting date: 2026-03-31), 10-K (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31).
1 Q2 2026 Calculation
Interest coverage
= (EBITQ2 2026
+ EBITQ1 2026
+ EBITQ4 2025
+ EBITQ3 2025)
÷ (Interest expenseQ2 2026
+ Interest expenseQ1 2026
+ Interest expenseQ4 2025
+ Interest expenseQ3 2025)
= (1,556,682 + 1,482,567 + 1,304,644 + 1,072,375)
÷ (51,156 + 51,159 + 51,290 + 51,429)
= 26.42
2 Click competitor name to see calculations.
The financial data indicates a significant transformation in solvency and operational profitability over the analyzed period. The trajectory shifts from a period of operational instability and inability to service debt to a position of substantial financial strength and high interest coverage capacity.
- Earnings Before Interest and Tax (EBIT) Trend
- A transition from negative to aggressively positive operating income is observed. Initial volatility is evident between March 2022 and December 2022, characterized by operating losses. However, starting in March 2023, a consistent and accelerating upward trend is established. EBIT grew from 71.1 million USD in March 2023 to 1.56 billion USD by June 2026, representing a profound increase in the company's capacity to generate profit from its core operations.
- Interest Expense Patterns
- Interest expenses exhibited an initial upward trend, rising from 32 million USD in March 2022 to a peak of 94.2 million USD in December 2024. Following this peak, a sharp reduction occurred in the first quarter of 2025, with expenses stabilizing at approximately 51 million USD through June 2026. This stabilization suggests either a reduction in total debt load or a refinancing of obligations at more favorable terms.
- Interest Coverage Ratio Evolution
- The interest coverage ratio reflects a critical improvement in creditworthiness. During 2022, the ratio remained near zero or turned negative, indicating that operating earnings were insufficient to cover interest obligations. A pivotal shift occurred in June 2023, when the ratio first exceeded 1.0, signifying the point where EBIT became sufficient to cover interest costs. From this point, the ratio entered a phase of exponential growth, rising from 1.12 in June 2023 to 26.42 by June 2026. This suggests a drastic reduction in insolvency risk and a vastly enhanced ability to service debt from operating cash flows.
The convergence of rapidly expanding EBIT and stabilizing interest expenses has resulted in an exceptional improvement in the solvency profile. The final recorded ratio indicates that the company generates over 26 times the earnings required to meet its interest obligations, moving from a position of financial vulnerability to one of high stability.
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