Starbucks Corp. (NASDAQ:SBUX)

Debt to Capital

The debt to capital ratio exhibited fluctuations over the periods analyzed. It initially decreased from 1.99 to 1.57, indicating a reduction in leverage, before increasing again to peak around 2.39, followed by a gradual decrease to approximately 1.80. Towards the end, the ratio showed a slight increase reaching 2.01. Overall, this suggests variability in the company's capital structure and leverage management during these intervals.

Debt to Capital (Including Operating Lease Liability)

This ratio displayed a relatively more stable trend compared to the debt to capital ratio excluding lease liabilities. Starting at 1.46, it fluctuated mildly within a narrow band between about 1.29 and 1.58 through most of the periods. The ratio gradually declined towards the later periods, reaching around 1.38 before a minor uptick to 1.44. This stability indicates consistent incorporation of lease liabilities in leverage calculations.

Debt to Assets

The debt to assets ratio was moderately stable, with values ranging from 0.47 to 0.55. An initial decline to 0.47 suggested a reduction in asset-based leverage, but it rebounded to around 0.55 and then tapered slightly to about 0.50 by the final period. Such levels imply that approximately half of the asset base was financed through debt consistently across the intervals.

Debt to Assets (Including Operating Lease Liability)

When operating lease liabilities were factored in, this ratio was significantly higher, ranging from 0.75 to 0.86. The pattern was stable but slightly elevated compared to the debt to assets ratio excluding leases, reflecting the material impact of lease liabilities on the company's total obligations.

Interest Coverage

The interest coverage ratio demonstrated a marked improvement in the early periods, rising from 2.78 to a high of 13.08, suggesting enhanced ability to meet interest obligations from earnings. After peaking, the ratio showed a gradual decline to 5.62 by the most recent period, indicating a reduction in the buffer available to cover interest expenses, though still remaining above the initial level. This trend signifies variability in earnings relative to interest expenses, potentially influenced by changes in profitability or interest costs.

The financial data reveals key trends in the capital structure and financial position over the reported quarters. These observations focus on total debt, shareholders’ deficit, and the implied leverage ratios.

Total Debt

Total debt exhibits fluctuations throughout the timeline, initially decreasing from approximately $15.9 billion to about $14.6 billion between late 2020 and mid-2021. Following this, there is a notable rise to around $16 billion by early 2022. Subsequently, total debt experiences a moderate decline and relative stability, oscillating between roughly $15 billion and $15.5 billion through late 2023 and early 2024. The last two quarters show a significant increase to approximately $17.3 billion, before decreasing again to about $16.1 billion.

Shareholders’ Deficit

The shareholders’ deficit presents sustained negative values throughout the periods, indicating a net deficit position. Starting at about -$7.9 billion at the end of 2020, the deficit generally narrows to approximately -$5.3 billion by late 2021, reflecting a reduction in negative equity. However, this improvement is not sustained, as the deficit widens again to nearly -$8.7 billion by early 2022. In subsequent quarters, the deficit somewhat stabilizes, fluctuating between approximately -$8.5 billion and -$7.9 billion through 2023. From early 2024 onwards, the shareholders’ deficit shows a trend of gradual improvement, narrowing to around -$7.4 billion before slightly deteriorating again to about -$8.1 billion by the second quarter of 2025.

Debt to Equity

Although explicit values for the debt to equity ratio are missing, it can be inferred that the negative shareholders’ equity complicates straightforward leverage analysis. The large negative equity values imply that any debt to equity ratio calculated would result in negative or undefined figures, suggesting a highly leveraged or impaired equity position. This situation may merit further examination of capital structure risk and financial stability.

In summary, the firm’s debt levels have demonstrated variability with periods of increase and stabilization, while the shareholders’ deficit remains substantial and negative, indicating an ongoing equity shortfall. The interplay between these factors underlines the importance of assessing financial leverage and solvency beyond conventional ratio analysis due to the persistent negative equity balance.

The analysis of the financial data reveals several notable trends relating to the company's leverage and equity position over the observed periods.

Total Debt (including operating lease liability)

The total debt level exhibits some volatility but remains generally within a range of approximately 23.5 billion to 26.6 billion US dollars over the periods presented. Starting at around 24.9 billion at the end of 2020, the debt decreased slightly in early 2021, stabilizing near 23.5 to 24.9 billion through much of 2022 and into early 2023. From late 2023 onward, there is a gradual upward trajectory, peaking near 27.9 billion in mid-2025 before a slight decline to approximately 26.6 billion by the end of the final period. This trend suggests the company has managed its debt strategically, with incremental increases in leverage towards the latter periods.

Shareholders’ Deficit

The shareholders’ deficit remains negative throughout all periods, indicating a persistent equity shortfall. The deficit shows meaningful fluctuations, starting at approximately -7.9 billion at the end of 2020, improving towards less negative values in mid-2021 and late 2021 through 2022, suggesting some recovery or reduced losses during that timeframe. However, from late 2022 onwards, the deficit again deepens, moving back to around -8.1 billion by mid-2025. This worsening equity position in the latter periods could signal deteriorating retained earnings or other equity impacts, which may require monitoring for sustainability.

Debt to Equity Ratio

The debt to equity ratio is not provided explicitly, but can be inferred to be negative or undefined due to the persistent negative shareholders’ equity. The negative equity indicates that the total liabilities exceed total assets, which complicates conventional leverage analysis. This situation suggests heightened financial risk and potentially limits the company’s borrowing capacity unless offset by other favorable financial conditions.

Overall, the financial trends point to relatively stable but elevated total debt levels combined with a consistent shareholders’ deficit, reflecting ongoing challenges in equity recovery despite controlled debt management. The implications include increased financial leverage and potential concerns regarding capitalization structure that warrant ongoing attention.

The analysis of the quarterly financial data reveals significant fluctuations and trends in the company's total debt, total capital, and the debt to capital ratio over the observed periods.

Total Debt

The total debt exhibits volatility over time, beginning at approximately $15.9 billion and experiencing decreases and increases through the quarters. Notably, after a decrease to around $14.6 billion in early 2021, the debt peaked near $17.3 billion in mid-2025 before settling back closer to $16.1 billion by late 2025. This pattern suggests active debt management, with periods of increased leverage followed by partial deleveraging.

Total Capital

Total capital also showed variability, starting at about $8.0 billion and reaching a low near $6.3 billion in early 2022. Subsequently, it generally trended upward, peaking above $9.6 billion in mid-2025 before declining back to roughly $7.9 billion by late 2025. This variation indicates fluctuating capital resources, possibly linked to retained earnings, equity issuance, or other capital structure decisions.

Debt to Capital Ratio

The debt to capital ratio remained consistently elevated throughout the timeline, fluctuating mostly between approximately 1.5 and 2.4. Initial values were close to 2.0 or slightly higher, with some reduction in late 2021 (around 1.57) indicating a temporary improvement in leverage. However, the ratio frequently returned to values exceeding 2.0, reflecting a relatively high reliance on debt financing compared to total capital. The highest ratios occurred near 2.37 and 2.39, corresponding with periods of debt increases or capital decreases.

Overall, the data indicate that the company maintains a capital structure with a high level of debt relative to its total capital. The periodic fluctuations in both debt and capital, along with the debt to capital ratio variations, suggest active financial management aimed at balancing leverage and capital adequacy. The ratio's persistent elevation above 1.5 denotes sustained leverage reliance, which could have implications for financial risk and cost of capital considerations.

The financial data indicates fluctuations in the total debt, total capital, and the debt to capital ratio for the company over the observed quarters. The analysis reveals several noteworthy trends and patterns in the company's financial leverage and capital structure.

Total Debt (Including Operating Lease Liability)

The total debt exhibits some variability but remains generally elevated throughout the periods. Beginning at approximately $24.9 billion, the debt exhibits a slight downward adjustment in early 2021 before fluctuating around $23.8 billion to $25.5 billion in subsequent quarters. Notably, there is a marked increase towards the end of the data set, reaching over $27.8 billion in mid-2025 before a modest decline to about $26.6 billion.

Total Capital (Including Operating Lease Liability)

Total capital shows more volatility, with an initial decrease from roughly $17.0 billion in late 2020 to a low near $15.1 billion in late 2022. Subsequently, capital levels begin an upward trend, peaking slightly above $18.3 billion by the end of 2024. Towards mid-2025, it again declines to around $18.5 billion. This movement suggests variable equity or retained earnings alongside debt.

Debt to Capital Ratio

This ratio remains above 1.0 throughout, indicating that total debt exceeds total capital consistently across periods. The ratio starts at 1.46 and generally demonstrates a downward trend from a high point near 1.58 in late 2022 to a lower range around 1.38 to 1.44 towards mid-2025. These movements reflect relative changes between debt and capital levels, showing a slight improvement in leverage after 2022, though the ratio remains elevated.

Overall, the company maintains a high level of leverage, with debt consistently exceeding total capital. While total debt demonstrates periods of stability and growth, total capital undergoes more pronounced fluctuations. The declining debt to capital ratio in recent periods may indicate cautious efforts to optimize capital structure, yet the leverage remains substantial, signaling a continued reliance on debt financing relative to capital employed.

Total Debt

The total debt levels exhibit fluctuations over the observed periods. Initially, total debt decreased from approximately 15.9 billion US dollars to around 14.6 billion by early 2021, followed by a general pattern of increase and stabilization, reaching about 15.9 billion in early 2024. A notable spike to over 17.3 billion was observed in mid-2025 before declining again.

Total Assets

Total assets show a moderate overall upward trend with some volatility. Starting near 30 billion US dollars, the asset base experienced occasional declines, such as in early 2022 and late 2022, but recovered consistently thereafter. By mid-2025, assets peaked above 33.6 billion, reflecting growth in the company's asset base over time.

Debt to Assets Ratio

The debt to assets ratio generally remained in the range of 0.47 to 0.55, indicating a fairly stable leverage profile. It tended to decline slightly during mid-2021 to late 2021 and again in mid-2024, suggesting periods of deleveraging or asset growth outpacing debt. The ratio’s fluctuations align closely with changes in debt and asset levels but remain consistently around the 50% mark, indicating balanced leverage management.

Overall Financial Trends

The data suggest a company managing a stable financial structure with moderate increase in both assets and debt. The fluctuations in total debt and assets appear cyclical but with an underlying trend of growth in asset base and cautious modulation of leverage. The temporary spike in debt in mid-2025 warrants attention as it departs from prevailing patterns, though it was followed by a reduction, indicating active debt management. The stable debt to asset ratio reinforces the notion of a controlled approach to financing and risk exposure.

The analysis of the quarterly financial data reveals several important trends related to the company's debt levels, asset base, and leverage ratio over the observed periods.

Total Debt (Including Operating Lease Liability)

The total debt fluctuated somewhat over the quarters, beginning around 24.9 billion USD and showing minor declines and increases through the periods. Notable increases occurred in early 2024 and mid-2025, where the debt rose above 25 billion USD, peaking near 27.9 billion USD before slightly decreasing. This suggests periods of increased borrowing or lease obligations, possibly to finance growth or operations.

Total Assets

Total assets demonstrated a generally increasing trend with fluctuations. Starting at approximately 29.9 billion USD, there was a dip in early 2022, followed by a gradual recovery and significant growth from 2023 onward, reaching above 33.6 billion USD by mid-2025. This upward trajectory indicates asset expansion, possibly due to acquisitions, capital investments, or asset revaluations.

Debt to Assets Ratio

The leverage ratio, calculated as total debt divided by total assets, remained fairly stable, oscillating between 0.75 and 0.86 across the quarters. It started high at 0.83, dipped to a low of 0.75 in late 2021, then rose again and stabilized around 0.83 to 0.86 in the more recent periods. This stability implies that while both debt and assets varied, their proportion remained relatively constant, reflecting a consistent capital structure approach.

In summary, the data indicates the company maintained a relatively consistent leverage ratio despite increases in total assets and variable total debt. Asset growth appears steady and potentially supports the higher debt levels observed. The company's financial structure shows balanced management of debt and asset growth over time.

Total assets

The total assets exhibit a fluctuating trend over the observed periods. Initially, assets decreased from approximately $29.97 billion at the end of 2020 to around $28.38 billion by the first quarter of 2021. Thereafter, the assets increased reaching about $31.39 billion in the fourth quarter of 2021. Following this peak, assets again declined to roughly $27.98 billion by the fourth quarter of 2022. From early 2023, the trend reversed with assets rising steadily, peaking at approximately $33.65 billion in the third quarter of 2025 before a slight drop to $32.02 billion in the last observed quarter. Overall, the long-term trajectory shows growth despite interim volatility.

Shareholders’ deficit

The shareholders’ deficit, recorded as a negative value, indicates continuing net liabilities. It decreases in magnitude (less negative) from about -$7.91 billion at the end of 2020 to roughly -$5.32 billion in the fourth quarter of 2021, reflecting a temporary improvement in equity position. However, this is followed by a deterioration, with the deficit worsening to approximately -$8.77 billion by the second quarter of 2022. Thereafter, a gradual but uneven improvement is observed, with the deficit reducing to around -$7.99 billion by the fourth quarter of 2023 and continuing to improve until mid-2024. Subsequently, the deficit fluctuates again, ending at about -$8.10 billion in the last quarter of the data. This pattern suggests persistent challenges in equity recovery despite periods of modest improvement.

Financial leverage

No data for financial leverage ratios are available in the observed periods, limiting further insight into the firm's capital structure and risk profile.

Earnings Before Interest and Tax (EBIT)

The EBIT figures exhibit significant fluctuations over the analyzed periods. Initially, there is a steady increase from approximately 929 million USD to a peak of about 2.37 billion USD in October 2021. Following this peak, the EBIT values decline sharply to just under 1 billion USD in April 2022. Subsequently, EBIT recovers and rises, reaching a notable peak of approximately 1.74 billion USD in October 2023. However, from that point onward, there is a consistent downward trend, with EBIT decreasing substantially to around 310 million USD by the end of the last period in September 2025.

Interest Expense

Interest expense shows a gradual increase across the timeline. Starting at around 121 million USD, it rises steadily with minor fluctuations to approximately 145 million USD by September 2025. The upward trend is relatively stable without any abrupt changes or volatility.

Interest Coverage Ratio

The interest coverage ratio, which measures the ability to cover interest expenses through EBIT, reflects notable changes correlated to EBIT fluctuations. It initially improves significantly from 2.78 to a peak of 13.08 by January 2022, indicating strong coverage capacity. After this peak, the ratio declines steadily over time, falling to around 5.62 by the final period. This decline reflects a reduced buffer to cover interest payments, driven by decreasing EBIT against gradually increasing interest expenses.

Summary Insights

The financial data suggest that the entity experienced robust operating profitability up to late 2021, followed by a period of volatility and a downward trend thereafter. Despite rising interest expenses, the interest coverage ratio remained strong until early 2022 but weakened significantly in subsequent years, reflecting weaker EBIT performance relative to interest obligations. The declining interest coverage ratio may indicate increasing financial risk or reduced earnings quality in the more recent periods. Monitoring evolving EBIT levels and interest expenses will be critical for assessing ongoing financial health and debt servicing capability.