Analysis of Solvency Ratios
Quarterly Data
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
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- Income Statement
- Statement of Comprehensive Income
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Reportable Segments
- Enterprise Value (EV)
- Enterprise Value to FCFF (EV/FCFF)
- Price to FCFE (P/FCFE)
- Present Value of Free Cash Flow to Equity (FCFE)
- Total Asset Turnover since 2005
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Solvency Ratios (Summary)
KLA Corp., solvency ratios (quarterly data)
Based on: 10-Q (reporting date: 2026-03-31), 10-Q (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-K (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-Q (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-K (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30).
The solvency profile is characterized by a period of stability followed by a sharp increase in leverage in mid-2022, succeeded by a consistent multi-year deleveraging trend. By the end of the observed period, solvency metrics have largely returned to levels seen prior to the 2022 spike.
- Leverage and Capital Structure
- A significant volatility event occurred in June 2022, where the debt to equity ratio peaked at 4.75 and financial leverage reached 8.99. This represents a substantial departure from the preceding trend, where the debt to equity ratio had been declining from 1.25 in September 2020 to 0.85 by December 2021. Following the June 2022 peak, there is a sustained downward trajectory across all leverage metrics. By March 2026, the debt to equity ratio returned to 1.01 and financial leverage normalized to 2.89, mirroring the baseline established in late 2021.
- Asset and Capital Ratios
- The debt to assets ratio and debt to capital ratio follow a parallel pattern to the general leverage metrics. The debt to assets ratio increased from a low of 0.29 in December 2021 to a peak of 0.53 in June 2022, before gradually receding to 0.35 by March 2026. Similarly, the debt to capital ratio rose to 0.83 in June 2022 and steadily declined to 0.50 by the conclusion of the period, indicating a systematic reduction in the proportion of debt used to finance the company's capital base.
- Interest Coverage and Debt Serviceability
- Interest coverage exhibited a strong upward trend from September 2020 (9.97) to a peak of 22.76 in June 2022, coinciding with the peak in leverage. This suggests that despite the increase in debt, the capacity to service interest payments remained robust. A subsequent decline in coverage is observed through March 2024, where the ratio hit a local minimum of 11.00, before entering a recovery phase that brought the ratio back to 19.94 by March 2026.
The overall trend indicates a strategic cycle of capital expansion followed by a disciplined reduction of debt. The convergence of the 2026 ratios with 2021 levels suggests a return to a previous long-term solvency equilibrium.
Debt Ratios
Coverage Ratios
Debt to Equity
KLA Corp., debt to equity calculation (quarterly data)
| 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 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||||
| Short-term debt | ||||||||||||||||||||||||||||||
| Current portion of long-term debt | ||||||||||||||||||||||||||||||
| Long-term debt, excluding current portion | ||||||||||||||||||||||||||||||
| Total debt | ||||||||||||||||||||||||||||||
| Total KLA stockholders’ equity | ||||||||||||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||
| Debt to equity1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Debt to Equity, Competitors2 | ||||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | ||||||||||||||||||||||||||||||
| Analog Devices Inc. | ||||||||||||||||||||||||||||||
| Applied Materials Inc. | ||||||||||||||||||||||||||||||
| Broadcom Inc. | ||||||||||||||||||||||||||||||
| Intel Corp. | ||||||||||||||||||||||||||||||
| Lam Research Corp. | ||||||||||||||||||||||||||||||
| Micron Technology Inc. | ||||||||||||||||||||||||||||||
| NVIDIA Corp. | ||||||||||||||||||||||||||||||
| Qualcomm Inc. | ||||||||||||||||||||||||||||||
| Texas Instruments Inc. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2026-03-31), 10-Q (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-K (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-Q (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-K (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30).
1 Q3 2026 Calculation
Debt to equity = Total debt ÷ Total KLA stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
The solvency profile exhibits a volatile trajectory in the debt-to-equity ratio, characterized by an initial period of deleveraging, a severe spike in leverage during mid-2022, and a subsequent multi-year recovery phase.
- Initial Solvency Improvement (September 2020 – December 2021)
- During this period, total debt remained relatively stagnant at approximately 3.4 billion USD, while stockholders' equity grew steadily from 2.7 billion USD to over 4.0 billion USD. This growth in equity relative to stable debt obligations resulted in a consistent decline in the debt-to-equity ratio, which dropped from 1.25 to a low of 0.85.
- Leverage Peak and Equity Compression (March 2022 – June 2022)
- A significant shift in the capital structure occurred in the second quarter of 2022. Total debt increased sharply to 6.66 billion USD, while stockholders' equity experienced a drastic contraction, falling to 1.40 billion USD. This simultaneous increase in liabilities and decrease in equity caused the debt-to-equity ratio to spike to 4.75, representing the highest level of financial leverage within the observed timeframe.
- Sustained Recovery and Normalization (September 2022 – March 2026)
- Following the 2022 peak, a long-term trend of solvency restoration is evident. Although total debt fluctuated between 5.8 billion and 6.6 billion USD, stockholders' equity entered a period of robust and consistent growth, rising from 2.10 billion USD in September 2022 to 5.83 billion USD by March 2026. As a result, the debt-to-equity ratio trended downward from 3.00 to 1.01, effectively returning the organization to a leverage position comparable to the levels maintained in early 2021.
Debt to Capital
KLA Corp., debt to capital calculation (quarterly data)
| 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 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||||
| Short-term debt | ||||||||||||||||||||||||||||||
| Current portion of long-term debt | ||||||||||||||||||||||||||||||
| Long-term debt, excluding current portion | ||||||||||||||||||||||||||||||
| Total debt | ||||||||||||||||||||||||||||||
| Total KLA stockholders’ equity | ||||||||||||||||||||||||||||||
| Total capital | ||||||||||||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||
| Debt to capital1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Debt to Capital, Competitors2 | ||||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | ||||||||||||||||||||||||||||||
| Analog Devices Inc. | ||||||||||||||||||||||||||||||
| Applied Materials Inc. | ||||||||||||||||||||||||||||||
| Broadcom Inc. | ||||||||||||||||||||||||||||||
| Intel Corp. | ||||||||||||||||||||||||||||||
| Lam Research Corp. | ||||||||||||||||||||||||||||||
| Micron Technology Inc. | ||||||||||||||||||||||||||||||
| NVIDIA Corp. | ||||||||||||||||||||||||||||||
| Qualcomm Inc. | ||||||||||||||||||||||||||||||
| Texas Instruments Inc. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2026-03-31), 10-Q (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-K (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-Q (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-K (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30).
1 Q3 2026 Calculation
Debt to capital = Total debt ÷ Total capital
= ÷ =
2 Click competitor name to see calculations.
The solvency profile exhibits a cyclical pattern characterized by strategic debt increases followed by gradual deleveraging, occurring against a backdrop of consistent growth in total capital. Total capital expanded from approximately 6.17 billion USD in September 2020 to 11.72 billion USD by March 2026, providing a larger base to absorb debt obligations over the observed period.
- Initial Deleveraging Phase (September 2020 – December 2021)
- During this period, total debt remained relatively stagnant, fluctuating slightly around 3.44 billion USD. However, total capital grew steadily from 6.17 billion USD to 7.49 billion USD. This divergence resulted in a consistent decline in the debt-to-capital ratio, which moved from 0.55 to a period low of 0.46.
- Leverage Peak and Volatility (March 2022 – June 2022)
- A significant shift in solvency occurred in the first half of 2022. Total debt increased sharply, peaking at 6.66 billion USD in June 2022. This rapid accumulation of debt outpaced the growth of total capital, leading to a spike in the debt-to-capital ratio to its highest point of 0.83.
- Stabilization and Gradual Reduction (September 2022 – December 2023)
- Following the peak, a trend of stabilization emerged. While total debt remained elevated compared to 2020 levels, it gradually decreased from 6.31 billion USD in September 2022 to approximately 5.89 billion USD by December 2023. Concurrently, total capital continued to rise, reaching 8.94 billion USD, which effectively lowered the debt-to-capital ratio to 0.66.
- Long-term Convergence and Capital Expansion (March 2024 – March 2026)
- The final phase shows a sustained improvement in solvency. Despite a brief increase in total debt to 6.63 billion USD in early 2024, the subsequent period saw debt settle back toward 5.89 billion USD. The most prominent driver during this phase was the aggressive expansion of total capital, which grew from 9.72 billion USD in March 2024 to 11.72 billion USD by March 2026. Consequently, the debt-to-capital ratio returned to 0.50, effectively neutralizing the leverage spike observed in 2022.
Debt to Assets
KLA Corp., debt to assets calculation (quarterly data)
| 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 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||||
| Short-term debt | ||||||||||||||||||||||||||||||
| Current portion of long-term debt | ||||||||||||||||||||||||||||||
| Long-term debt, excluding current portion | ||||||||||||||||||||||||||||||
| Total debt | ||||||||||||||||||||||||||||||
| Total assets | ||||||||||||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||
| Debt to assets1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Debt to Assets, Competitors2 | ||||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | ||||||||||||||||||||||||||||||
| Analog Devices Inc. | ||||||||||||||||||||||||||||||
| Applied Materials Inc. | ||||||||||||||||||||||||||||||
| Broadcom Inc. | ||||||||||||||||||||||||||||||
| Intel Corp. | ||||||||||||||||||||||||||||||
| Lam Research Corp. | ||||||||||||||||||||||||||||||
| Micron Technology Inc. | ||||||||||||||||||||||||||||||
| NVIDIA Corp. | ||||||||||||||||||||||||||||||
| Qualcomm Inc. | ||||||||||||||||||||||||||||||
| Texas Instruments Inc. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2026-03-31), 10-Q (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-K (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-Q (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-K (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30).
1 Q3 2026 Calculation
Debt to assets = Total debt ÷ Total assets
= ÷ =
2 Click competitor name to see calculations.
The solvency profile exhibits a cyclical pattern of leverage increase followed by a gradual deleveraging process against a backdrop of consistent asset expansion.
- Asset Growth and Initial Deleveraging
- Between September 2020 and December 2021, total assets grew steadily from 9.32 billion USD to 11.68 billion USD. During this period, total debt remained relatively stagnant at approximately 3.44 billion USD. This divergence resulted in a consistent decline in the debt-to-assets ratio, which dropped from 0.37 to a period low of 0.29.
- Debt Surge and Peak Leverage
- A significant shift in the capital structure occurred during the first half of 2022. Total debt rose sharply from 3.70 billion USD in March to 6.66 billion USD by June 2022. This rapid accumulation of liabilities caused the debt-to-assets ratio to spike to its peak of 0.53, representing the highest level of leverage observed in the analyzed timeframe.
- Stabilization and Solvency Recovery
- From September 2022 through March 2026, a long-term trend of solvency improvement is observed. While total debt fluctuated—including a temporary increase to 6.63 billion USD in early 2024—it eventually stabilized around 5.89 billion USD. Simultaneously, total assets continued a strong upward trajectory, reaching 16.87 billion USD by March 2026. The compounding effect of debt stabilization and asset growth led to a gradual reduction of the debt-to-assets ratio, which returned to 0.35 by the end of the period.
The overall trajectory indicates that the increase in the asset base has effectively mitigated the impact of higher debt levels, restoring the solvency ratio to levels comparable to those seen at the start of the period.
Financial Leverage
KLA Corp., financial leverage calculation (quarterly data)
| 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 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||||
| Total assets | ||||||||||||||||||||||||||||||
| Total KLA stockholders’ equity | ||||||||||||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||
| Financial leverage1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Financial Leverage, Competitors2 | ||||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | ||||||||||||||||||||||||||||||
| Analog Devices Inc. | ||||||||||||||||||||||||||||||
| Applied Materials Inc. | ||||||||||||||||||||||||||||||
| Broadcom Inc. | ||||||||||||||||||||||||||||||
| Intel Corp. | ||||||||||||||||||||||||||||||
| Lam Research Corp. | ||||||||||||||||||||||||||||||
| Micron Technology Inc. | ||||||||||||||||||||||||||||||
| NVIDIA Corp. | ||||||||||||||||||||||||||||||
| Qualcomm Inc. | ||||||||||||||||||||||||||||||
| Texas Instruments Inc. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2026-03-31), 10-Q (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-K (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-Q (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-K (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30).
1 Q3 2026 Calculation
Financial leverage = Total assets ÷ Total KLA stockholders’ equity
= ÷ =
2 Click competitor name to see calculations.
The financial position from September 30, 2020, through March 31, 2026, is characterized by steady asset expansion and a significant volatility event in equity during mid-2022, followed by a sustained period of deleveraging.
- Asset Growth Trajectory
- Total assets exhibited a consistent upward trend, increasing from approximately 9.32 billion USD in September 2020 to 16.87 billion USD by March 31, 2026. This represents a steady expansion of the balance sheet over the observed period, with only a minor contraction observed between September 30, 2024, and December 31, 2024.
- Equity Volatility and Recovery
- Stockholders' equity showed an initial increase from 2.75 billion USD to 4.08 billion USD by March 31, 2022. However, a sharp decline occurred on June 30, 2022, where equity dropped to 1.40 billion USD. Following this trough, a strong recovery phase is evident, with equity growing consistently to reach 5.83 billion USD by the end of the period.
- Financial Leverage Analysis
- The financial leverage ratio initially declined from 3.39 to 2.95 between September 2020 and March 2022, indicating a reduction in reliance on debt relative to equity. A significant spike to 8.99 occurred in June 2022, directly correlating with the sharp decrease in stockholders' equity. Subsequent to this peak, a persistent downward trend is observed, with the ratio steadily decreasing to 2.89 by March 31, 2026.
- Solvency Implications
- The long-term movement of the financial leverage ratio suggests a strategic shift toward a more conservative capital structure. The return of the leverage ratio to 2.89—a level lower than the initial 2020 figures—indicates that the equity base grew at a faster rate than total assets during the recovery period, thereby enhancing the overall solvency profile of the entity.
Interest Coverage
KLA Corp., interest coverage calculation (quarterly data)
| 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 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | Dec 31, 2020 | Sep 30, 2020 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||||||||||||||||||||||||||
| Net income attributable to KLA | ||||||||||||||||||||||||||||||
| Add: Net income attributable to noncontrolling interest | ||||||||||||||||||||||||||||||
| Add: Income tax expense | ||||||||||||||||||||||||||||||
| Add: Interest expense | ||||||||||||||||||||||||||||||
| Earnings before interest and tax (EBIT) | ||||||||||||||||||||||||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||
| Interest coverage1 | ||||||||||||||||||||||||||||||
| Benchmarks | ||||||||||||||||||||||||||||||
| Interest Coverage, Competitors2 | ||||||||||||||||||||||||||||||
| Advanced Micro Devices Inc. | ||||||||||||||||||||||||||||||
| Analog Devices Inc. | ||||||||||||||||||||||||||||||
| Applied Materials Inc. | ||||||||||||||||||||||||||||||
| Broadcom Inc. | ||||||||||||||||||||||||||||||
| Micron Technology Inc. | ||||||||||||||||||||||||||||||
| NVIDIA Corp. | ||||||||||||||||||||||||||||||
| Qualcomm Inc. | ||||||||||||||||||||||||||||||
| Texas Instruments Inc. | ||||||||||||||||||||||||||||||
Based on: 10-Q (reporting date: 2026-03-31), 10-Q (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-K (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-Q (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-K (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-Q (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-K (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-K (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-K (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-Q (reporting date: 2020-09-30).
1 Q3 2026 Calculation
Interest coverage
= (EBITQ3 2026
+ EBITQ2 2026
+ EBITQ1 2026
+ EBITQ4 2025)
÷ (Interest expenseQ3 2026
+ Interest expenseQ2 2026
+ Interest expenseQ1 2026
+ Interest expenseQ4 2025)
= ( + + + )
÷ ( + + + )
=
2 Click competitor name to see calculations.
The interest coverage profile exhibits a cyclical trajectory characterized by an initial period of rapid expansion, a mid-term contraction, and a subsequent recovery phase. The overall solvency position remains robust throughout the observed period, with the interest coverage ratio consistently maintained above 10.0, indicating a strong capacity to service debt obligations from operational earnings.
- Earnings Before Interest and Tax (EBIT) Performance
- Operational profitability demonstrated significant growth from September 2020 through December 2022, with EBIT increasing from 523.2 million to 1.22 billion. A period of volatility occurred throughout 2023, where earnings declined to a trough of 765.5 million in December 2023. Following this dip, a sustained recovery was observed, culminating in a peak of 1.49 billion by March 2026, reflecting a strong long-term upward trend in core operational earnings.
- Interest Expense Dynamics
- Interest expenses remained stable at approximately 39 million per quarter until September 2022, when a sharp increase to 74.4 million was recorded. This elevated cost structure persisted through 2023 and 2024, reaching a peak of 82.8 million in June 2024. Toward the end of the analyzed period, interest expenses began a gradual decline, settling at 70.4 million by March 2026.
- Interest Coverage Ratio Trends
- The interest coverage ratio evolved through three distinct phases. The first phase, spanning September 2020 to June 2022, saw the ratio rise from 9.97 to a peak of 22.76, driven by substantial EBIT growth against flat interest costs. The second phase, from June 2022 to December 2023, witnessed a decline to 11.51, triggered by the simultaneous spike in interest expenses and a contraction in operational earnings. The final phase, from December 2023 to March 2026, shows a consistent recovery, with the ratio climbing back to 19.94 as EBIT growth significantly outpaced debt servicing costs.