Booking Holdings Inc. (NASDAQ:BKNG)

Debt to Equity

The debt to equity ratio initially declined from 2.9 in the first quarter of 2021 to 1.77 by the end of that year, indicating a deleveraging trend. However, starting in early 2022, the ratio increased steadily, reaching a peak of 11.29 by the first quarter of 2023, suggesting a significant rise in debt relative to equity over this period.

Debt to Equity (Including Operating Lease Liability)

This metric follows a similar pattern to the debt to equity ratio, with a decrease through 2021 followed by a marked increase into early 2023, where it reached 11.79. This implies that operating lease liabilities contribute slightly to the overall leverage but follow the same upward trend.

Debt to Capital

Debt to capital ratios showed a gradual decline from 0.74 in early 2021 to 0.64 at the end of 2021, reflecting reduced leverage. From 2022 onwards, a persistent increase is evident, culminating at 1.62 in the third quarter of 2025, indicating rising reliance on debt financing compared to total capital. The ratio fluctuates slightly in late 2024 and early 2025 but remains elevated compared to earlier years.

Debt to Capital (Including Operating Lease Liability)

This ratio mirrors the trend of debt to capital, starting lower in 2021 and growing through to mid-2025, peaking at 1.59, indicating consistent leverage increase with the inclusion of operating lease liabilities.

Debt to Assets

The debt to assets ratio shows a modest decline from 0.58 to 0.46 during 2021, meaning the company reduced its debt relative to total assets. From 2022, this ratio rose steadily, peaking near 0.6 during various quarters between late 2023 and mid-2025, suggesting an ongoing increase in debt proportion relative to assets.

Debt to Assets (Including Operating Lease Liability)

Including operating lease liabilities, the ratio is consistently slightly higher but follows a similar trajectory: decreasing in 2021 before rising to approximately 0.61 by the middle of 2025. This points to higher overall leverage when factoring in lease obligations.

Financial Leverage

Financial leverage declined from nearly 5.0 to under 4.0 in 2021, indicating less reliance on debt relative to equity. However, in 2022, this ratio increased sharply, reaching 23.47 in early 2023, reflecting a dramatic increase in leverage, though data beyond this point are not available.

Interest Coverage

Interest coverage ratios fluctuated over the period, dropping to a low of 3.03 in mid-2021, then rising to a high of 11.24 in late 2021, indicating improved ability to cover interest expenses. Post-2021, interest coverage remained generally elevated but showed a declining trend from 10.82 to around 4.16 by mid-2025, suggesting decreasing ability to service interest as debt levels rose.

The analysis of the financial trends reveals significant fluctuations in the company's leverage and equity position over the observed periods.

Total Debt

Total debt exhibited a general downward trend from March 31, 2021, when it stood at $13,835 million, reaching its lowest point of $9,184 million by September 30, 2022. However, from December 31, 2022, there was a marked increase in total debt, surging to $12,485 million and continuing upward with some volatility, peaking again at $18,472 million in June 30, 2025 before slightly declining to $16,996 million in September 30, 2025. This indicates a substantial increase in leverage in the more recent periods.

Stockholders’ Equity (Deficit)

Stockholders’ equity showed a declining trajectory across the timeline. Starting at $4,764 million as of March 31, 2021, equity initially rose modestly to $6,178 million by December 31, 2021. Thereafter, a consistent decline occurred, with equity turning negative in June 30, 2023 (-$665 million) and reaching its most negative point at about -$4,276 million in June 30, 2024. Though some fluctuations are observed afterward, equity remains substantially negative through September 30, 2025. This developing deficit suggests deteriorating net asset value and possible challenges in maintaining equity capital.

Debt to Equity Ratio

The debt to equity ratio reflected increasing leverage risk over time. Initially, the ratio decreased from 2.90 in March 31, 2021, to a low of 1.77 by December 31, 2021, aligned with rising equity and falling debt. However, starting in the first quarter of 2022, the ratio escalated sharply, reaching 4.49 by December 31, 2022, and dramatically increasing to 11.29 as of March 31, 2023. The ratio for subsequent quarters is unavailable, but given the negative equity and high levels of debt observed, it implies a highly leveraged financial structure and increased financial risk.

In summary, the company moved from a relatively stable leverage position with positive equity through 2021 towards a heavily leveraged structure accompanied by persistent equity deficits beginning in 2023. This shift indicates heightened financial risk and potential solvency challenges, underscoring the importance of strategic financial management to stabilize the balance sheet.

Total Debt (Including Operating Lease Liability)

The total debt shows a downward trend from March 2021 through September 2022, decreasing from approximately $14.2 billion to around $9.5 billion. However, starting in the last quarter of 2022, the total debt increased significantly, reaching a peak of about $18.9 billion in June 2025 before slightly declining to $17.5 billion by September 2025. This suggests a shift from debt reduction to increased leverage or financing activities in the later periods.

Stockholders’ Equity (Deficit)

Stockholders' equity demonstrates a fluctuating but overall downward trajectory over the period examined. Starting at $4.8 billion in March 2021, equity declines sharply from December 2022 onward, turning into a deficit by June 2023. The deficit deepens steadily, reaching a low near -$6.7 billion in June 2025, with a slight improvement to approximately -$4.7 billion by September 2025. This indicates deteriorating net asset value and potentially ongoing losses or accounting adjustments negatively impacting equity.

Debt to Equity Ratio (Including Operating Lease Liability)

The debt to equity ratio reflects the interplay between rising debt and declining equity. From March 2021 to December 2021, the ratio declines from 2.97 to 1.83, consistent with falling debt and stable to increasing equity. After December 2021, the ratio trends sharply upward, particularly in the quarters following September 2022, reaching a high of 11.79 by March 2023. Subsequent data for this ratio is not available, but the earlier trend suggests significant leverage and financial strain as equity turns negative while debt remains elevated.

Overall Analysis

The company experienced an initial period of deleveraging and equity growth through 2021, followed by a reversal characterized by rising debt levels and substantial declines in stockholders' equity from late 2022 onward. The rapid increase in the debt to equity ratio to exceptionally high levels correlates with the transition of equity into significant deficit territory, highlighting increased financial risk. This pattern may reflect operational challenges, increased borrowing, or other adverse events affecting the company’s balance sheet strength and capital structure stability during the latter half of the period analyzed.

The financial data reveals several notable trends regarding the company's debt structure and capital composition over the observed periods.

Total Debt

The total debt exhibited a general downward trend from March 31, 2021, through September 30, 2022, declining from approximately $13.8 billion to around $9.2 billion. However, beginning in December 31, 2022, there is a marked reversal with total debt increasing significantly, peaking near $18.5 billion by June 30, 2025, before showing a slight decrease by the last reported period. This indicates a substantial rise in leverage during the most recent quarters examined.

Total Capital

Total capital declined overall from roughly $18.6 billion at the start of the period to a low of about $9.9 billion by March 31, 2025. This decline was especially pronounced from 2022 through early 2025, with only minor fluctuations, suggesting possible reductions in equity or retained earnings components or revaluation effects impacting the capital base.

Debt to Capital Ratio

The debt to capital ratio trends reflect changes in both debt and capital levels. Initially, the ratio decreased from 0.74 to a low of 0.64 by December 31, 2021, showing an improvement in leverage and possibly stronger capital positioning relative to debt. Subsequently, there is a consistent and sharp increase in this ratio starting early 2022, peaking at 1.62 by June 30, 2025. This indicates that debt exceeds total capital, pointing to increased financial risk and higher leverage.

Overall, the analysis highlights a shift from a reducing debt burden and relatively stable or improving capital structure in the early part of the period to a phase characterized by rising debt levels and deteriorating debt-to-capital ratios. The elevated leverage levels seen in the latest periods could imply greater financial risk and potential challenges in meeting obligations without additional capital infusion or debt restructuring strategies.

The financial data reveals significant fluctuations in the company's debt structure and capital base over the examined quarters. The following summary outlines key trends and insights:

Total Debt (including operating lease liability)

The total debt displayed a decreasing trend from March 2021 through September 2022, moving from approximately $14.2 billion down to around $9.5 billion. However, starting in the fourth quarter of 2022, there is a marked increase in total debt, reaching a peak near $18.5 billion by March 2025. This indicates a notable rise in leverage or financing activities in the latter periods after a phase of debt reduction.

Total Capital (including operating lease liability)

The total capital follows a somewhat parallel but less volatile pattern. Initially declining from about $19 billion in early 2021 to roughly $13.1 billion in September 2022, the capital base rebounded slightly during the last part of 2022 but then showed a tendency to stabilize around $13 billion until the end of 2024. A modest recovery is observed again towards March 2025, reaching nearly $12.8 billion. Overall, the capital base demonstrates less pronounced fluctuations compared to total debt.

Debt to Capital Ratio (including operating lease liability)

The debt to capital ratio exhibits a distinct upward trend throughout the period. Initially at 0.75 in early 2021, it declines gradually to a low of 0.65 by December 2021, illustrating a strengthening capital structure relative to debt during this timeframe. However, from early 2022, the ratio increases sharply, exceeding 1.0 starting in the second quarter of 2023 and peaking above 1.5 in mid-2025. This ratio surpassing 1.0 suggests that total debt exceeds total capital, signaling elevated financial risk and higher leverage levels.

In summary, after a period of deleveraging through 2021 and 2022, the company’s financial profile shifts towards increased debt levels relative to capital from late 2022 onwards. The rising debt to capital ratio, crossing the threshold of 1.0, emphasizes growing reliance on debt financing, which could affect financial flexibility and risk exposure. The capital base remains relatively stable but does not keep pace with the accelerating debt load, reinforcing the observation of increased leverage in the most recent quarters.

Total Debt

The total debt demonstrates a general fluctuating pattern over the analyzed periods. Initially, there is a downward trend from 13,835 million US$ at the beginning of 2021 to around 9,184 million US$ by the third quarter of 2022. Subsequently, debt increases significantly, peaking at 18,472 million US$ in the middle of 2025 before declining slightly towards the end of the data at 16,996 million US$. This indicates periods of both deleveraging and increased borrowing, with more pronounced debt accumulation in the most recent quarters.

Total Assets

Total assets display a moderate cyclical increase and decrease across the quarters. Starting from approximately 23,655 million US$ in early 2021, assets fluctuate but trend upward overall, reaching a peak of about 30,684 million US$ in mid-2025 before reducing somewhat to 28,752 million US$ near the latest quarter. The asset base size indicates the company has been expanding its resources, although with some volatility in asset levels.

Debt to Assets Ratio

The debt to assets ratio follows a declining trend initially, moving from 0.58 at the start of 2021 down to a low of 0.39 in the mid-2022 period, reflecting a reduction in leverage relative to asset size. However, following this low point, the ratio increases consistently, reaching a high near 0.61 in early 2024 and remaining close to 0.59-0.60 in the latest quarters. This trend signals an increase in financial leverage, with a growing portion of assets financed by debt in recent years after a period of deleveraging.

Overall Insights

The data suggests that the company initially focused on reducing debt and improving its leverage position from 2021 through mid-2022. However, from late 2022 onwards, there is a clear shift toward increased borrowing, reflected in both the rise in total debt and an elevated debt to asset ratio. Despite growing debt levels, total assets have also increased, indicating asset growth accompanying increased leverage. This pattern may reflect strategic initiatives requiring more capital or shifts in financing strategy, though it also indicates heightened financial risk due to increased leverage.

Total debt (including operating lease liability)

Over the observed periods, total debt exhibited a fluctuating trend. Initially, there was a steady decrease from 14,166 million USD in March 2021 to a low of 9,470 million USD in September 2022. Following this decline, a notable increase occurred, with debt reaching a peak of 18,989 million USD by June 2025. The subsequently recorded values maintained a relatively high level above 16,500 million USD, indicating increased leverage in the most recent periods.

Total assets

Total assets displayed moderate volatility throughout the timeframe. Beginning at 23,655 million USD in March 2021, assets experienced minor fluctuations but generally trended upward, reaching 28,541 million USD by June 2024. Thereafter, a slight decrease was observed, with assets settling around 28,752 million USD by September 2025. The overall asset growth suggests incremental expansion of the company's asset base over the period.

Debt to assets (including operating lease liability) ratio

The debt to assets ratio showed an initial downward trend from 0.60 in March 2021 to 0.40 in June 2022, reflecting an improved capital structure with reduced relative debt levels. However, from that point forward, the ratio reversed course, rising steadily to reach approximately 0.62 by the latest periods in 2025. This increase aligns with the concurrent rise in total debt, indicating a higher proportion of debt financing relative to assets in recent quarters.

Summary

The data reveals a period of deleveraging from early 2021 to mid-2022, characterized by decreasing debt and debt-to-assets ratio alongside relatively stable asset levels. Subsequently, a phase of increased borrowing emerged, with total debt and the debt-to-assets ratio climbing notably through 2025. Total assets grew moderately over the entire period but did not keep pace with the rise in debt during the latter intervals. This suggests a strategic shift towards greater leverage, which may impact the company's financial risk profile.

The analysis of the financial data reveals several notable trends over the observed periods. Total assets exhibit fluctuations with an overall upward movement towards the later periods. Specifically, total assets increased moderately from early 2021 through mid-2023, peaking near the end of 2024 and early 2025, though with some volatility evident during the intermediate quarters.

Stockholders’ equity displays a clear declining trend over the same timeframe. Starting with positive equity values in 2021, equity progressively diminishes, turning negative around early 2023 and remaining in deficit territory through to the latest reporting dates in 2025. This decline suggests growing losses or distributions exceeding earnings, which might impact the company's financial stability and borrowing capacity.

Financial leverage, measured as a ratio, shows significant variation. Initially stable and relatively moderate in early 2021, it begins to rise noticeably around 2022. By the end of 2022 and the early part of 2023, the ratio spikes dramatically, indicating an increased reliance on debt relative to equity. The sharp increase in financial leverage coincides with the period when stockholders’ equity turns negative, underscoring increased financial risk and leverage during these periods. Subsequent data on financial leverage is not available, possibly due to the negative equity complicating the calculation.

Total Assets

Fluctuated between approximately $22 billion and $31 billion with an overall increasing tendency, peaking around 2024-2025.

Stockholders’ Equity (Deficit)

Declined significantly from a positive range near $6 billion in late 2021 to negative values exceeding -$6 billion by mid-2025, signaling deteriorating equity positions.

Financial Leverage (Ratio)

Remained near 4 to 6 in early periods but surged above 20 by early 2023, reflecting increased debt relative to shareholders’ equity and elevated financial risk. Data not available in subsequent periods likely due to negative equity disrupting ratio calculation.

In summary, the company has increased its asset base modestly but faced a persistent and severe decline in equity, resulting in substantially higher financial leverage. This pattern may indicate challenges in profitability, capital structure, or asset quality that warrant further investigation to assess sustainability and financial risk going forward.

The analysis of the financial trends reveals significant variations in earnings before interest and tax (EBIT), interest expense, and the interest coverage ratio over the examined periods.

Earnings Before Interest and Tax (EBIT)

The EBIT displays considerable fluctuations, commencing with a negative figure of -180 million US dollars at the start of the period. This negative EBIT transitions into positive territory in subsequent quarters, peaking notably at 3,403 million US dollars in the third quarter of 2023. Occasional declines are observed after peak points, such as the decrease from 3,403 million to 619 million in the last quarter of 2023, followed by a recovery and further growth in subsequent quarters. The overall trend indicates substantial volatility with periods of strong profitability interspersed with declines, though the general direction from 2021 to 2025 is upward, culminating in a high of 3,770 million US dollars by the third quarter of 2025.

Interest Expense

Interest expense shows a steady and significant upward trend throughout the timeline. Starting at 98 million US dollars in the first quarter of 2021, it climbs consistently to a peak of 649 million in the third quarter of 2025. There are no periods of substantial decline; rather, the expense generally rises, signaling increasing borrowing costs or higher debt levels over time. The sharpest increases appear in the later years, particularly from 2023 onwards, suggesting growing financial obligations or increased leverage.

Interest Coverage Ratio

The interest coverage ratio, which measures the ability to cover interest expenses with EBIT, shows notable improvement early in the period, rising from 3.59 to a peak of 11.24 in the third quarter of 2022. After reaching this peak, the ratio gradually declines but remains above 4.0, indicating that the company maintains a capacity to meet interest obligations comfortably. The decline from the peak suggests that while earnings remain sufficient to cover interest expenses, the margin of safety reduces over time due to the rising interest expenses and variability in EBIT. The ratio’s fluctuation reflects the combined effect of volatile EBIT and steadily increasing interest costs.

In summary, the company experiences volatile but generally increasing EBIT alongside rising interest expenses over the period. The interest coverage ratio indicates strong but diminishing flexibility in covering interest costs, pointing to potential future challenges if the trends in increasing interest expenses continue without proportional EBIT growth.