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)
Tesla Inc., 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 exhibits a period of aggressive deleveraging throughout 2022 and early 2023, followed by a phase of relative stability in the capital structure. Across all debt-based ratios, there is a clear shift toward a lower-risk financial position compared to the initial period, characterized by a minimal reliance on borrowed funds.
- Debt-to-Equity, Debt-to-Capital, and Debt-to-Assets Ratios
- A synchronized downward trend is observed in these three ratios from March 2022 through June 2023. Debt to equity decreased from 0.17 to 0.07, while debt to assets fell from 0.09 to 0.04. Following this period of contraction, the ratios entered a stabilization phase, with debt to equity fluctuating between 0.08 and 0.12 and debt to assets remaining constant at approximately 0.06 through June 2026. This pattern indicates a successful reduction of debt relative to equity and total assets, maintaining a conservative leverage posture.
- Financial Leverage
- Financial leverage demonstrates a consistent long-term decline, moving from 1.94 in March 2022 to 1.71 by June 2026, with a cyclical low of 1.66 in June 2025. This steady reduction suggests a decrease in the proportion of assets financed by debt, reinforcing the overall trend toward improved solvency and reduced financial risk.
- Interest Coverage Ratio
- The interest coverage ratio exhibits the most significant volatility. A sharp increase occurred between March 2022 (29.34) and June 2023, where it reached a peak of 94.40. Subsequently, a sustained and pronounced downward trend is observed, with the ratio declining to 16.62 by June 2026. While the absolute value remains high—indicating that interest obligations are comfortably covered by earnings—the trajectory suggests a diminishing margin of safety or an increase in interest expenses relative to operating income.
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Debt Ratios
Coverage Ratios
Debt to Equity
Tesla Inc., 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 millions) | ||||||||||||||||||||||||
| Current portion of debt and finance leases | 1,418) | 1,447) | 1,640) | 1,924) | 2,040) | 2,237) | 2,456) | 2,291) | 2,264) | 2,461) | 2,373) | 2,861) | 2,485) | 2,461) | 2,565) | 2,540) | 2,714) | 2,784) | ||||||
| Debt and finance leases, net of current portion | 7,924) | 7,782) | 6,736) | 5,778) | 5,180) | 5,292) | 5,757) | 5,405) | 5,481) | 2,899) | 2,857) | 2,426) | 872) | 1,272) | 1,597) | 2,096) | 2,898) | 3,153) | ||||||
| Total debt | 9,342) | 9,229) | 8,376) | 7,702) | 7,220) | 7,529) | 8,213) | 7,696) | 7,745) | 5,360) | 5,230) | 5,287) | 3,357) | 3,733) | 4,162) | 4,636) | 5,612) | 5,937) | ||||||
| Stockholders’ equity | 86,858) | 84,116) | 82,137) | 79,970) | 77,314) | 74,653) | 72,913) | 69,931) | 66,468) | 64,378) | 62,634) | 53,466) | 51,130) | 48,054) | 44,704) | 39,851) | 36,376) | 34,085) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to equity1 | 0.11 | 0.11 | 0.10 | 0.10 | 0.09 | 0.10 | 0.11 | 0.11 | 0.12 | 0.08 | 0.08 | 0.10 | 0.07 | 0.08 | 0.09 | 0.12 | 0.15 | 0.17 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Equity, Competitors2 | ||||||||||||||||||||||||
| Ford Motor Co. | 4.51 | 4.20 | 4.54 | 3.42 | 3.50 | 3.48 | 3.54 | 3.55 | 3.46 | 3.49 | 3.49 | 3.22 | 3.28 | 3.29 | 3.21 | 3.05 | 2.92 | 3.01 | ||||||
| General Motors Co. | 2.06 | 2.04 | 2.13 | 2.00 | 2.05 | 2.06 | 2.06 | 1.80 | 1.84 | 1.84 | 1.89 | 1.60 | 1.65 | 1.64 | 1.69 | 1.73 | 1.73 | 1.77 | ||||||
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
= 9,342 ÷ 86,858 = 0.11
2 Click competitor name to see calculations.
The analysis of solvency metrics between March 2022 and June 2026 reveals a company maintaining a highly conservative leverage profile. While absolute debt levels have fluctuated and ultimately increased, the simultaneous and aggressive growth of stockholders' equity has kept the overall solvency risk low.
- Total Debt Evolution
- A dual-phase trend is observed in the total debt levels. From March 2022 to June 2023, debt was systematically reduced from 5,937 million USD to a low of 3,357 million USD. Following this period, a reversal occurred, with debt increasing steadily to reach 9,342 million USD by June 2026. This suggests a strategic shift toward increased borrowing in the latter half of the period.
- Stockholders' Equity Expansion
- Equity demonstrates a consistent and uninterrupted upward trajectory throughout the entire period. Starting at 34,085 million USD in March 2022, equity grew to 86,858 million USD by June 2026. This represents a substantial increase in the company's net asset base, providing a significant cushion against its liabilities.
- Debt to Equity Ratio Dynamics
- The debt to equity ratio reflects a strong solvency position. The ratio initially declined from 0.17 in March 2022 to a trough of 0.07 in June 2023, coinciding with the period of debt reduction. Although the ratio rose slightly as debt levels climbed, it stabilized between 0.09 and 0.11 from late 2023 through June 2026. The fact that the ratio remained low despite the increase in total debt indicates that equity growth significantly outpaced the accumulation of new debt.
Overall, the financial structure is characterized by low reliance on external debt relative to internal funding. The solvency position remains robust, as the expansion of the equity base effectively neutralized the impact of increased borrowing, resulting in a stable and low debt-to-equity ratio over the long term.
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Debt to Capital
Tesla Inc., 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 millions) | ||||||||||||||||||||||||
| Current portion of debt and finance leases | 1,418) | 1,447) | 1,640) | 1,924) | 2,040) | 2,237) | 2,456) | 2,291) | 2,264) | 2,461) | 2,373) | 2,861) | 2,485) | 2,461) | 2,565) | 2,540) | 2,714) | 2,784) | ||||||
| Debt and finance leases, net of current portion | 7,924) | 7,782) | 6,736) | 5,778) | 5,180) | 5,292) | 5,757) | 5,405) | 5,481) | 2,899) | 2,857) | 2,426) | 872) | 1,272) | 1,597) | 2,096) | 2,898) | 3,153) | ||||||
| Total debt | 9,342) | 9,229) | 8,376) | 7,702) | 7,220) | 7,529) | 8,213) | 7,696) | 7,745) | 5,360) | 5,230) | 5,287) | 3,357) | 3,733) | 4,162) | 4,636) | 5,612) | 5,937) | ||||||
| Stockholders’ equity | 86,858) | 84,116) | 82,137) | 79,970) | 77,314) | 74,653) | 72,913) | 69,931) | 66,468) | 64,378) | 62,634) | 53,466) | 51,130) | 48,054) | 44,704) | 39,851) | 36,376) | 34,085) | ||||||
| Total capital | 96,200) | 93,345) | 90,513) | 87,672) | 84,534) | 82,182) | 81,126) | 77,627) | 74,213) | 69,738) | 67,864) | 58,753) | 54,487) | 51,787) | 48,866) | 44,487) | 41,988) | 40,022) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to capital1 | 0.10 | 0.10 | 0.09 | 0.09 | 0.09 | 0.09 | 0.10 | 0.10 | 0.10 | 0.08 | 0.08 | 0.09 | 0.06 | 0.07 | 0.09 | 0.10 | 0.13 | 0.15 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Capital, Competitors2 | ||||||||||||||||||||||||
| Ford Motor Co. | 0.82 | 0.81 | 0.82 | 0.77 | 0.78 | 0.78 | 0.78 | 0.78 | 0.78 | 0.78 | 0.78 | 0.76 | 0.77 | 0.77 | 0.76 | 0.75 | 0.74 | 0.75 | ||||||
| General Motors Co. | 0.67 | 0.67 | 0.68 | 0.67 | 0.67 | 0.67 | 0.67 | 0.64 | 0.65 | 0.65 | 0.65 | 0.61 | 0.62 | 0.62 | 0.63 | 0.63 | 0.63 | 0.64 | ||||||
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
= 9,342 ÷ 96,200 = 0.10
2 Click competitor name to see calculations.
The solvency profile is characterized by an initial phase of aggressive deleveraging followed by a controlled increase in total debt, which was offset by a consistent and significant expansion of the total capital base.
- Total Debt Trajectory
- A downward trend in total debt was observed from March 2022 to June 2023, with obligations decreasing from $5,937 million to a period low of $3,357 million. Subsequently, total debt increased, reaching $9,342 million by June 2026. This indicates a transition from debt reduction toward a period of increased borrowing.
- Total Capital Expansion
- Total capital exhibited continuous growth throughout the entire period, rising from $40,022 million in March 2022 to $96,200 million by June 2026. This steady upward trend reflects a substantial increase in the overall financial resources of the entity, more than doubling the capital base over the analyzed timeframe.
- Debt to Capital Ratio Analysis
- The debt to capital ratio declined from a peak of 0.15 in March 2022 to a minimum of 0.06 in June 2023. Following this decline, the ratio experienced a moderate increase and stabilized between 0.08 and 0.10 from December 2023 through June 2026. The fact that the ratio remained stable despite the rise in absolute debt levels suggests that the increase in borrowing was well-proportioned relative to the growth in total capital, maintaining a consistent solvency risk level.
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Debt to Assets
Tesla Inc., debt to assets calculation (quarterly data)
| Jun 30, 2026 | Mar 31, 2026 | Dec 31, 2025 | Sep 30, 2025 | Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||
| Current portion of debt and finance leases | 1,418) | 1,447) | 1,640) | 1,924) | 2,040) | 2,237) | 2,456) | 2,291) | 2,264) | 2,461) | 2,373) | 2,861) | 2,485) | 2,461) | 2,565) | 2,540) | 2,714) | 2,784) | ||||||
| Debt and finance leases, net of current portion | 7,924) | 7,782) | 6,736) | 5,778) | 5,180) | 5,292) | 5,757) | 5,405) | 5,481) | 2,899) | 2,857) | 2,426) | 872) | 1,272) | 1,597) | 2,096) | 2,898) | 3,153) | ||||||
| Total debt | 9,342) | 9,229) | 8,376) | 7,702) | 7,220) | 7,529) | 8,213) | 7,696) | 7,745) | 5,360) | 5,230) | 5,287) | 3,357) | 3,733) | 4,162) | 4,636) | 5,612) | 5,937) | ||||||
| Total assets | 148,524) | 143,724) | 137,806) | 133,735) | 128,567) | 125,111) | 122,070) | 119,852) | 112,832) | 109,226) | 106,618) | 93,941) | 90,591) | 86,833) | 82,338) | 74,426) | 68,513) | 66,038) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to assets1 | 0.06 | 0.06 | 0.06 | 0.06 | 0.06 | 0.06 | 0.07 | 0.06 | 0.07 | 0.05 | 0.05 | 0.06 | 0.04 | 0.04 | 0.05 | 0.06 | 0.08 | 0.09 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Assets, Competitors2 | ||||||||||||||||||||||||
| Ford Motor Co. | 0.56 | 0.56 | 0.56 | 0.54 | 0.54 | 0.55 | 0.56 | 0.55 | 0.55 | 0.54 | 0.55 | 0.53 | 0.54 | 0.54 | 0.54 | 0.52 | 0.52 | 0.54 | ||||||
| General Motors Co. | 0.45 | 0.45 | 0.46 | 0.46 | 0.47 | 0.47 | 0.46 | 0.44 | 0.45 | 0.44 | 0.45 | 0.42 | 0.43 | 0.43 | 0.43 | 0.43 | 0.44 | 0.44 | ||||||
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
= 9,342 ÷ 148,524 = 0.06
2 Click competitor name to see calculations.
The financial trajectory from March 2022 through June 2026 demonstrates a consistent expansion of the asset base accompanied by strategic fluctuations in total debt levels. While absolute debt increased in the latter half of the period, the growth in total assets effectively neutralized the impact on solvency, maintaining a low and stable leverage profile.
- Total Assets Growth
- A sustained upward trend is evident in total assets, which grew from 66,038 million US$ in March 2022 to 148,524 million US$ by June 2026. This represents a consistent expansion of the company's resource base throughout the entire analyzed period, providing a substantial buffer against liabilities.
- Debt Accumulation Patterns
- Total debt exhibited two distinct phases. An initial deleveraging phase occurred between March 2022 and June 2023, where debt decreased from 5,937 million US$ to a low of 3,357 million US$. This was followed by a period of debt accumulation starting in September 2023, with total debt reaching 9,342 million US$ by June 2026. Despite this increase, the debt levels remained relatively small compared to the scale of total assets.
- Debt to Assets Ratio Stability
- The debt to assets ratio initially declined from 0.09 in March 2022 to a minimum of 0.04 in the second quarter of 2023. Following a slight correction in late 2023, the ratio stabilized, fluctuating narrowly between 0.05 and 0.07. For the final six quarters of the period, the ratio remained constant at 0.06, indicating that the increase in debt was precisely offset by the growth in assets.
Overall, the analysis indicates a strong solvency position. The ability to increase absolute debt levels while maintaining a constant debt-to-assets ratio of 0.06 suggests that the company is leveraging its expanding balance sheet to fund operations or growth without compromising its long-term financial stability.
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Financial Leverage
Tesla Inc., 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 millions) | ||||||||||||||||||||||||
| Total assets | 148,524) | 143,724) | 137,806) | 133,735) | 128,567) | 125,111) | 122,070) | 119,852) | 112,832) | 109,226) | 106,618) | 93,941) | 90,591) | 86,833) | 82,338) | 74,426) | 68,513) | 66,038) | ||||||
| Stockholders’ equity | 86,858) | 84,116) | 82,137) | 79,970) | 77,314) | 74,653) | 72,913) | 69,931) | 66,468) | 64,378) | 62,634) | 53,466) | 51,130) | 48,054) | 44,704) | 39,851) | 36,376) | 34,085) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Financial leverage1 | 1.71 | 1.71 | 1.68 | 1.67 | 1.66 | 1.68 | 1.67 | 1.71 | 1.70 | 1.70 | 1.70 | 1.76 | 1.77 | 1.81 | 1.84 | 1.87 | 1.88 | 1.94 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Financial Leverage, Competitors2 | ||||||||||||||||||||||||
| Ford Motor Co. | 7.99 | 7.54 | 8.04 | 6.35 | 6.50 | 6.37 | 6.36 | 6.48 | 6.35 | 6.40 | 6.39 | 6.06 | 6.09 | 6.06 | 5.92 | 5.86 | 5.56 | 5.62 | ||||||
| General Motors Co. | 4.56 | 4.48 | 4.60 | 4.34 | 4.36 | 4.38 | 4.44 | 4.08 | 4.12 | 4.15 | 4.25 | 3.78 | 3.85 | 3.82 | 3.89 | 3.99 | 3.96 | 4.05 | ||||||
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
= 148,524 ÷ 86,858 = 1.71
2 Click competitor name to see calculations.
The financial trajectory from March 2022 through June 2026 is characterized by a substantial expansion of the balance sheet accompanied by a progressive reduction in financial leverage, indicating a strengthened solvency position and a shift toward a more conservative capital structure.
- Asset Expansion
- Total assets exhibited consistent growth throughout the period, rising from 66,038 million USD in March 2022 to 148,524 million USD by June 2026. This represents more than a twofold increase in the total resource base, reflecting significant operational scaling.
- Equity Growth
- Stockholders' equity demonstrated a steady upward trend, increasing from 34,085 million USD to 86,858 million USD. The growth in equity has largely kept pace with asset expansion, reinforcing the company's net worth and reducing reliance on external liabilities.
- Financial Leverage Trends
- The financial leverage ratio experienced a notable decline from its peak of 1.94 in March 2022 to 1.70 by December 2023. This downward movement indicates that a larger portion of the asset base became funded by equity rather than debt, thereby lowering the overall financial risk profile.
- Capital Structure Stabilization
- Between March 2024 and June 2026, the leverage ratio entered a period of relative stability, fluctuating within a narrow range between 1.66 and 1.71. The minimum ratio of 1.66 was recorded in June 2025, after which the ratio plateaued near 1.71, suggesting a settled strategic equilibrium in the company's approach to financial leverage.
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Interest Coverage
Tesla Inc., 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 millions) | ||||||||||||||||||||||||
| Net income attributable to common stockholders | 1,114) | 477) | 840) | 1,373) | 1,172) | 409) | 2,128) | 2,173) | 1,400) | 1,390) | 7,928) | 1,853) | 2,703) | 2,513) | 3,687) | 3,292) | 2,259) | 3,318) | ||||||
| Add: Net income attributable to noncontrolling interest | 14) | 14) | 16) | 16) | 18) | 11) | 15) | 16) | 16) | 15) | 15) | 25) | (89) | 26) | 20) | 39) | 10) | (38) | ||||||
| Add: Income tax expense | 201) | 257) | 325) | 570) | 359) | 169) | 381) | 602) | 371) | 483) | (5,752) | 167) | 323) | 261) | 276) | 305) | 205) | 346) | ||||||
| Add: Interest expense | 81) | 92) | 85) | 76) | 86) | 91) | 96) | 92) | 86) | 76) | 61) | 38) | 28) | 29) | 33) | 53) | 44) | 61) | ||||||
| Earnings before interest and tax (EBIT) | 1,410) | 840) | 1,266) | 2,035) | 1,635) | 680) | 2,620) | 2,883) | 1,873) | 1,964) | 2,252) | 2,083) | 2,965) | 2,829) | 4,016) | 3,689) | 2,518) | 3,687) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Interest coverage1 | 16.62 | 17.04 | 16.62 | 19.97 | 21.42 | 22.07 | 26.69 | 28.48 | 31.31 | 45.64 | 64.93 | 92.91 | 94.40 | 82.09 | 72.83 | 55.02 | 36.16 | 29.34 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Interest Coverage, Competitors2 | ||||||||||||||||||||||||
| Ford Motor Co. | -7.80 | -6.25 | -8.43 | 5.41 | 4.77 | 6.55 | 7.49 | 3.57 | 3.88 | 3.69 | 4.05 | 6.58 | 4.59 | 3.38 | -1.40 | 6.10 | 7.71 | 7.10 | ||||||
| General Motors Co. | 4.04 | 4.95 | 5.29 | 7.21 | 10.22 | 11.75 | 11.07 | 15.31 | 14.65 | 13.66 | 12.42 | 13.39 | 13.65 | 12.65 | 12.75 | 12.89 | 11.56 | 13.21 | ||||||
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)
= (1,410 + 840 + 1,266 + 2,035)
÷ (81 + 92 + 85 + 76)
= 16.62
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The analysis of solvency ratios reveals a significant deterioration in the capacity to cover interest obligations over the period from March 2022 to June 2026. While the interest coverage ratio initially experienced a period of substantial growth, a sustained downward trajectory emerged after the second quarter of 2023, indicating a weakening solvency profile.
- Earnings Before Interest and Tax (EBIT)
- A general decline in operational profitability is observed. EBIT reached peak levels in 2022, with a high of 4,016 million USD in December 2022. However, a subsequent downward trend is evident, characterized by increased volatility and a notable contraction in early 2025, where earnings dropped to 680 million USD. Although some periodic recoveries occurred, the overall trend indicates a reduction in the primary income source used to service debt.
- Interest Expense
- Interest costs remained relatively low and stable through 2022, bottoming at 33 million USD in December 2022. Starting in early 2023, a steady increase in interest expenses was recorded, peaking at 96 million USD in December 2024. For the remainder of the period, expenses stabilized within a range of 76 million to 92 million USD, effectively increasing the fixed financial burden on the organization.
- Interest Coverage Ratio
- The interest coverage ratio demonstrated a sharp arc of expansion followed by a consistent decline. The ratio peaked at 94.40 in June 2023, representing a high margin of safety. Following this peak, the ratio fell steadily, reaching 16.62 by June 2026. This decline is the result of the dual impact of contracting EBIT and rising interest expenses, which together have significantly compressed the operational cushion available to meet interest payments.
In summary, the solvency position has shifted from a state of exceptional coverage in mid-2023 to a more constrained position by mid-2026. While the ratio remains above 1.0, indicating that interest obligations are still being met, the magnitude of the decrease suggests a diminished capacity to absorb further operational shocks or increases in borrowing costs.
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