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)
Abbott Laboratories, 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).
A sustained period of deleveraging is evident from March 2022 through December 2025, during which the company systematically reduced its reliance on debt across all measured solvency metrics. This trend of balance sheet strengthening was abruptly reversed in the first half of 2026, marked by a significant increase in leverage and a deterioration in interest coverage capacity.
- Debt Utilization Ratios
- The debt to equity ratio exhibited a consistent downward trajectory, falling from 0.48 in March 2022 to a low of 0.25 by December 2025. Similarly, the debt to capital and debt to assets ratios declined steadily, reaching 0.20 and 0.15 respectively by the end of 2025. However, a sharp inflection point occurred in March 2026, where the debt to equity ratio spiked to 0.65, and debt to assets rose to 0.31, suggesting a substantial increase in borrowed funds or a significant capital restructuring event.
- Financial Leverage
- Financial leverage followed a mirroring pattern to the debt ratios, decreasing from 2.09 in early 2022 to a minimum of 1.65 in September 2025 before stabilizing at 1.66 in December 2025. This indicated a reduction in the proportion of assets financed by equity. This trend reversed sharply in 2026, with leverage climbing to 2.14 by June 30, 2026, surpassing the levels recorded at the beginning of the analyzed period.
- Interest Coverage Capacity
- Interest coverage showed higher volatility compared to the leverage ratios. After an initial peak of 20.07 in June 2022, the ratio entered a period of decline, reaching a trough of 10.79 in September 2023. A recovery phase ensued, with the ratio climbing back to 18.17 by December 2025. This recovery was short-lived, as the ratio fell precipitously to 10.81 by June 30, 2026, coinciding with the sharp increase in total debt.
The overall solvency profile shifted from a position of increasing conservatism between 2022 and 2025 to a significantly more leveraged position by mid-2026. The simultaneous spike in debt ratios and the collapse of the interest coverage ratio in the final two quarters suggest a rapid expansion of the debt load that has materially impacted the company's ability to service its interest obligations relative to its earnings.
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Debt Ratios
Coverage Ratios
Debt to Equity
Abbott Laboratories, 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) | ||||||||||||||||||||||||
| Short-term borrowings | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | ||||||
| Current portion of long-term debt | 3,005) | 4,409) | 3,033) | 1,345) | 507) | 506) | 1,500) | 2,154) | 1,615) | 2,010) | 1,080) | 1,051) | 2,284) | 2,285) | 2,251) | 1,117) | 5) | 4) | ||||||
| Long-term debt, excluding current portion | 29,603) | 29,638) | 9,896) | 11,596) | 12,930) | 12,736) | 12,625) | 12,825) | 13,139) | 12,576) | 13,599) | 14,477) | 14,562) | 14,615) | 14,522) | 15,297) | 16,755) | 17,086) | ||||||
| Total debt | 32,608) | 34,047) | 12,929) | 12,941) | 13,437) | 13,242) | 14,125) | 14,979) | 14,754) | 14,586) | 14,679) | 15,528) | 16,846) | 16,900) | 16,773) | 16,414) | 16,760) | 17,090) | ||||||
| Total Abbott shareholders’ investment | 51,110) | 52,061) | 52,130) | 50,954) | 50,565) | 48,811) | 47,664) | 39,796) | 39,318) | 38,810) | 38,603) | 37,481) | 37,174) | 37,010) | 36,686) | 35,675) | 36,490) | 35,399) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to equity1 | 0.64 | 0.65 | 0.25 | 0.25 | 0.27 | 0.27 | 0.30 | 0.38 | 0.38 | 0.38 | 0.38 | 0.41 | 0.45 | 0.46 | 0.46 | 0.46 | 0.46 | 0.48 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Equity, Competitors2 | ||||||||||||||||||||||||
| Elevance Health Inc. | 0.69 | 0.73 | 0.73 | 0.73 | 0.69 | 0.71 | 0.76 | 0.62 | 0.66 | 0.65 | 0.64 | 0.65 | 0.66 | 0.68 | 0.66 | 0.66 | 0.66 | 0.65 | ||||||
| Intuitive Surgical 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 | ||||||
| Medtronic PLC | 0.60 | 0.60 | 0.59 | 0.54 | 0.58 | 0.58 | 0.50 | 0.49 | 0.49 | 0.49 | 0.47 | 0.55 | 0.51 | 0.44 | 0.46 | 0.48 | 0.49 | 0.50 | ||||||
| UnitedHealth Group Inc. | — | 0.80 | 0.83 | 0.84 | 0.84 | 0.86 | 0.83 | 0.83 | 0.84 | 0.85 | 0.70 | 0.75 | 0.80 | 0.87 | 0.74 | 0.65 | 0.71 | 0.65 | ||||||
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 ÷ Total Abbott shareholders’ investment
= 32,608 ÷ 51,110 = 0.64
2 Click competitor name to see calculations.
The solvency profile exhibits a distinct two-phase trajectory, characterized by a prolonged period of deleveraging and capital strengthening followed by a sudden, significant increase in debt obligations in early 2026.
- Total Debt Trends
- A consistent downward trend in total debt is observed from March 2022, starting at 17,090 million, and continuing through December 2025, reaching a low of 12,929 million. This period of steady reduction was interrupted in March 2026 by a substantial increase, with total debt jumping to 34,047 million, before slightly moderating to 32,608 million by June 2026.
- Shareholders' Investment Growth
- Total shareholders' investment demonstrated sustained growth, rising from 35,399 million in March 2022 to 52,130 million in December 2025. A particularly sharp increase occurred between September 2024 (39,796 million) and December 2024 (47,664 million), which significantly bolstered the company's equity base prior to the increase in liabilities in 2026.
- Debt to Equity Ratio Analysis
- The debt to equity ratio reflects a strong improvement in solvency for the majority of the analyzed period, declining from 0.48 in March 2022 to 0.25 by December 2025. This indicates a reduced reliance on leverage relative to equity. However, this positive trend was reversed in March 2026, when the ratio spiked to 0.65, mirroring the sharp increase in total debt. The ratio remained elevated at 0.64 as of June 2026, indicating a shift back toward a more leveraged capital structure.
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Debt to Capital
Abbott Laboratories, 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) | ||||||||||||||||||||||||
| Short-term borrowings | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | ||||||
| Current portion of long-term debt | 3,005) | 4,409) | 3,033) | 1,345) | 507) | 506) | 1,500) | 2,154) | 1,615) | 2,010) | 1,080) | 1,051) | 2,284) | 2,285) | 2,251) | 1,117) | 5) | 4) | ||||||
| Long-term debt, excluding current portion | 29,603) | 29,638) | 9,896) | 11,596) | 12,930) | 12,736) | 12,625) | 12,825) | 13,139) | 12,576) | 13,599) | 14,477) | 14,562) | 14,615) | 14,522) | 15,297) | 16,755) | 17,086) | ||||||
| Total debt | 32,608) | 34,047) | 12,929) | 12,941) | 13,437) | 13,242) | 14,125) | 14,979) | 14,754) | 14,586) | 14,679) | 15,528) | 16,846) | 16,900) | 16,773) | 16,414) | 16,760) | 17,090) | ||||||
| Total Abbott shareholders’ investment | 51,110) | 52,061) | 52,130) | 50,954) | 50,565) | 48,811) | 47,664) | 39,796) | 39,318) | 38,810) | 38,603) | 37,481) | 37,174) | 37,010) | 36,686) | 35,675) | 36,490) | 35,399) | ||||||
| Total capital | 83,718) | 86,108) | 65,059) | 63,895) | 64,002) | 62,053) | 61,789) | 54,775) | 54,072) | 53,396) | 53,282) | 53,009) | 54,020) | 53,910) | 53,459) | 52,089) | 53,250) | 52,489) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to capital1 | 0.39 | 0.40 | 0.20 | 0.20 | 0.21 | 0.21 | 0.23 | 0.27 | 0.27 | 0.27 | 0.28 | 0.29 | 0.31 | 0.31 | 0.31 | 0.32 | 0.31 | 0.33 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Capital, Competitors2 | ||||||||||||||||||||||||
| Elevance Health Inc. | 0.41 | 0.42 | 0.42 | 0.42 | 0.41 | 0.41 | 0.43 | 0.38 | 0.40 | 0.39 | 0.39 | 0.39 | 0.40 | 0.41 | 0.40 | 0.40 | 0.40 | 0.39 | ||||||
| Intuitive Surgical 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 | ||||||
| Medtronic PLC | 0.37 | 0.37 | 0.37 | 0.35 | 0.37 | 0.37 | 0.33 | 0.33 | 0.33 | 0.33 | 0.32 | 0.35 | 0.34 | 0.31 | 0.31 | 0.32 | 0.33 | 0.34 | ||||||
| UnitedHealth Group Inc. | — | 0.44 | 0.45 | 0.46 | 0.46 | 0.46 | 0.45 | 0.45 | 0.46 | 0.46 | 0.41 | 0.43 | 0.44 | 0.46 | 0.43 | 0.39 | 0.41 | 0.39 | ||||||
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
= 32,608 ÷ 83,718 = 0.39
2 Click competitor name to see calculations.
The solvency profile exhibits three distinct phases characterized by initial stability, a period of strategic deleveraging, and a sudden, substantial increase in leverage during the first half of 2026.
- Stability and Marginal Decline (March 2022 – December 2023)
- During this period, the debt to capital ratio remained relatively stable, fluctuating within a narrow range between 0.33 and 0.28. Total debt showed a gradual downward trajectory, decreasing from 17,090 million USD to 14,679 million USD. Total capital remained consistent, hovering around 53 billion USD, indicating a controlled approach to capital structure management.
- Deleveraging and Capital Expansion (March 2024 – December 2025)
- A sustained downward trend in the debt to capital ratio is observed, reaching a low of 0.20 by the end of 2025. This improvement in solvency was driven by a dual effect: total debt continued to decline, reaching 12,929 million USD, while total capital expanded steadily from 53,396 million USD to 65,059 million USD. This indicates a shift toward a more equity-heavy capital structure and a reduced reliance on borrowed funds.
- Significant Leverage Increase (March 2026 – June 2026)
- A sharp reversal in the solvency trend occurred in the first quarter of 2026. Total debt surged from 12,929 million USD in December 2025 to 34,047 million USD in March 2026, representing a significant increase in borrowing. Although total capital also rose to 86,108 million USD, the debt to capital ratio spiked to 0.40, the highest level recorded in the analyzed period. This ratio remained elevated at 0.39 as of June 30, 2026, suggesting a fundamental shift in the company's financing strategy or a large-scale capital acquisition.
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Debt to Assets
Abbott Laboratories, 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) | ||||||||||||||||||||||||
| Short-term borrowings | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | —) | ||||||
| Current portion of long-term debt | 3,005) | 4,409) | 3,033) | 1,345) | 507) | 506) | 1,500) | 2,154) | 1,615) | 2,010) | 1,080) | 1,051) | 2,284) | 2,285) | 2,251) | 1,117) | 5) | 4) | ||||||
| Long-term debt, excluding current portion | 29,603) | 29,638) | 9,896) | 11,596) | 12,930) | 12,736) | 12,625) | 12,825) | 13,139) | 12,576) | 13,599) | 14,477) | 14,562) | 14,615) | 14,522) | 15,297) | 16,755) | 17,086) | ||||||
| Total debt | 32,608) | 34,047) | 12,929) | 12,941) | 13,437) | 13,242) | 14,125) | 14,979) | 14,754) | 14,586) | 14,679) | 15,528) | 16,846) | 16,900) | 16,773) | 16,414) | 16,760) | 17,090) | ||||||
| Total assets | 109,215) | 110,429) | 86,713) | 84,181) | 83,999) | 81,448) | 81,414) | 74,356) | 73,017) | 72,467) | 73,214) | 72,090) | 73,354) | 73,794) | 74,438) | 72,801) | 74,202) | 74,007) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to assets1 | 0.30 | 0.31 | 0.15 | 0.15 | 0.16 | 0.16 | 0.17 | 0.20 | 0.20 | 0.20 | 0.20 | 0.22 | 0.23 | 0.23 | 0.23 | 0.23 | 0.23 | 0.23 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Assets, Competitors2 | ||||||||||||||||||||||||
| Elevance Health Inc. | 0.25 | 0.25 | 0.26 | 0.26 | 0.25 | 0.25 | 0.27 | 0.23 | 0.25 | 0.24 | 0.23 | 0.22 | 0.23 | 0.23 | 0.23 | 0.23 | 0.23 | 0.23 | ||||||
| Intuitive Surgical 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 | ||||||
| Medtronic PLC | 0.32 | 0.31 | 0.31 | 0.30 | 0.31 | 0.31 | 0.28 | 0.28 | 0.28 | 0.28 | 0.27 | 0.30 | 0.29 | 0.26 | 0.27 | 0.27 | 0.28 | 0.28 | ||||||
| UnitedHealth Group Inc. | — | 0.25 | 0.25 | 0.25 | 0.26 | 0.26 | 0.26 | 0.26 | 0.26 | 0.26 | 0.23 | 0.22 | 0.23 | 0.25 | 0.23 | 0.20 | 0.22 | 0.21 | ||||||
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
Debt to assets = Total debt ÷ Total assets
= 32,608 ÷ 109,215 = 0.30
2 Click competitor name to see calculations.
The analysis of solvency metrics reveals a distinct two-phase trajectory characterized by a multi-year period of deleveraging followed by a significant expansion of the balance sheet in early 2026.
- Deleveraging and Asset Optimization (March 2022 – December 2025)
- During this period, a consistent improvement in the debt-to-assets ratio is observed. The ratio remained stable at 0.23 through mid-2023 before initiating a steady decline to a low of 0.15 by December 2025. This downward trend was driven by a simultaneous reduction in total debt, which fell from 17,090 million USD to 12,929 million USD, and a gradual increase in total assets, which grew from 74,007 million USD to 86,713 million USD.
- Balance Sheet Expansion (March 2026 – June 2026)
- A sharp reversal in the solvency trend occurred in the first quarter of 2026. Total debt increased abruptly to 34,047 million USD, representing a significant surge from previous levels. This increase in liabilities was accompanied by a substantial expansion in total assets, which rose to 110,429 million USD. Consequently, the debt-to-assets ratio climbed to 0.31 in March 2026, before stabilizing slightly at 0.30 by June 2026.
- Overall Solvency Impact
- The financial profile shifted from a conservative posture, where debt represented only 15% of assets, to a more leveraged position where debt accounts for approximately 30% of assets. The synchronized spike in both total debt and total assets in 2026 suggests a large-scale strategic event, such as a major acquisition or significant capital investment, which fundamentally altered the organization's capital structure.
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Financial Leverage
Abbott Laboratories, 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 | 109,215) | 110,429) | 86,713) | 84,181) | 83,999) | 81,448) | 81,414) | 74,356) | 73,017) | 72,467) | 73,214) | 72,090) | 73,354) | 73,794) | 74,438) | 72,801) | 74,202) | 74,007) | ||||||
| Total Abbott shareholders’ investment | 51,110) | 52,061) | 52,130) | 50,954) | 50,565) | 48,811) | 47,664) | 39,796) | 39,318) | 38,810) | 38,603) | 37,481) | 37,174) | 37,010) | 36,686) | 35,675) | 36,490) | 35,399) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Financial leverage1 | 2.14 | 2.12 | 1.66 | 1.65 | 1.66 | 1.67 | 1.71 | 1.87 | 1.86 | 1.87 | 1.90 | 1.92 | 1.97 | 1.99 | 2.03 | 2.04 | 2.03 | 2.09 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Financial Leverage, Competitors2 | ||||||||||||||||||||||||
| Elevance Health Inc. | 2.82 | 2.87 | 2.77 | 2.79 | 2.79 | 2.82 | 2.83 | 2.66 | 2.68 | 2.76 | 2.77 | 2.88 | 2.86 | 2.92 | 2.83 | 2.86 | 2.82 | 2.79 | ||||||
| Intuitive Surgical Inc. | 1.15 | 1.15 | 1.15 | 1.14 | 1.13 | 1.12 | 1.14 | 1.14 | 1.13 | 1.13 | 1.16 | 1.17 | 1.17 | 1.16 | 1.17 | 1.15 | 1.14 | 1.13 | ||||||
| Medtronic PLC | 1.88 | 1.90 | 1.91 | 1.82 | 1.86 | 1.87 | 1.79 | 1.75 | 1.75 | 1.77 | 1.77 | 1.83 | 1.80 | 1.71 | 1.73 | 1.75 | 1.76 | 1.78 | ||||||
| UnitedHealth Group Inc. | — | 3.19 | 3.29 | 3.29 | 3.26 | 3.26 | 3.22 | 3.17 | 3.20 | 3.28 | 3.08 | 3.34 | 3.40 | 3.49 | 3.16 | 3.26 | 3.16 | 3.04 | ||||||
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 ÷ Total Abbott shareholders’ investment
= 109,215 ÷ 51,110 = 2.14
2 Click competitor name to see calculations.
The financial leverage of the organization exhibits a distinct three-phase trajectory characterized by a prolonged period of deleveraging followed by a sharp increase in asset-based financing during the first half of 2026.
- Deleveraging Trend (March 2022 – September 2025)
- A consistent reduction in financial leverage is observed, with the ratio declining from 2.09 in March 2022 to a minimum of 1.65 by September 2025. This downward trend was supported by a steady growth in total shareholders' investment, which rose from 35,399 million US$ to 50,954 million US$, while total assets remained relatively stable, fluctuating primarily between 72,000 million US$ and 84,000 million US$.
- Asset Expansion and Equity Growth (December 2024 – December 2025)
- A notable acceleration in total assets began in December 2024, increasing from 74,356 million US$ to 86,713 million US$ by the end of 2025. This expansion was accompanied by a significant increase in shareholders' investment, which reached 52,130 million US$. Consequently, the financial leverage ratio remained at historically low levels, oscillating between 1.71 and 1.65, indicating that asset growth during this window was largely funded through equity.
- Rapid Leverage Spike (March 2026 – June 2026)
- A sharp reversal in the leverage trend is evident in the first half of 2026. Total assets surged from 86,713 million US$ in December 2025 to 110,429 million US$ by March 2026. As shareholders' investment remained nearly stagnant, ending at 51,110 million US$ in June 2026, the financial leverage ratio increased abruptly to 2.12 and further to 2.14. This shift indicates a substantial increase in the reliance on external liabilities to finance the rapid expansion of the asset base.
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Interest Coverage
Abbott Laboratories, 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 earnings | 928) | 1,077) | 1,776) | 1,644) | 1,779) | 1,325) | 9,229) | 1,646) | 1,302) | 1,225) | 1,594) | 1,436) | 1,375) | 1,318) | 1,033) | 1,435) | 2,018) | 2,447) | ||||||
| Add: Income tax expense | 596) | 372) | 582) | 536) | 371) | 453) | (7,199) | 294) | 305) | 211) | 201) | 235) | 261) | 244) | 287) | 323) | 334) | 429) | ||||||
| Add: Interest expense | 351) | 174) | 120) | 121) | 121) | 131) | 136) | 142) | 140) | 141) | 159) | 166) | 159) | 153) | 154) | 141) | 132) | 131) | ||||||
| Earnings before interest and tax (EBIT) | 1,875) | 1,623) | 2,478) | 2,301) | 2,271) | 1,909) | 2,166) | 2,082) | 1,747) | 1,577) | 1,954) | 1,837) | 1,795) | 1,715) | 1,474) | 1,899) | 2,484) | 3,007) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Interest coverage1 | 10.81 | 16.18 | 18.17 | 16.99 | 15.90 | 14.40 | 13.55 | 12.65 | 11.74 | 11.46 | 11.46 | 10.79 | 11.34 | 13.06 | 15.89 | 18.41 | 20.07 | 18.10 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Interest Coverage, Competitors2 | ||||||||||||||||||||||||
| Elevance Health Inc. | 5.08 | 5.39 | 5.79 | 6.16 | 6.33 | 7.14 | 7.67 | 8.52 | 9.07 | 8.70 | 8.49 | 8.87 | 9.76 | 9.95 | 10.13 | 10.75 | 10.71 | 11.01 | ||||||
| Medtronic PLC | 9.03 | 8.67 | 8.72 | 7.89 | 7.72 | 7.65 | 7.73 | 8.87 | 8.97 | 9.90 | 9.43 | 10.15 | 11.02 | 10.88 | 10.98 | 10.95 | 10.18 | 5.65 | ||||||
| UnitedHealth Group Inc. | — | 4.68 | 4.67 | 6.51 | 7.48 | 7.94 | 6.14 | 6.39 | 6.79 | 7.53 | 9.97 | 10.21 | 10.99 | 12.25 | 13.59 | 14.66 | 14.45 | 14.26 | ||||||
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)
= (1,875 + 1,623 + 2,478 + 2,301)
÷ (351 + 174 + 120 + 121)
= 10.81
2 Click competitor name to see calculations.
The analysis of the interest coverage ratio over the observed period reveals a cyclical pattern of decline and recovery, followed by a significant deterioration in the most recent quarters.
- Operating Income Trends
- Earnings before interest and tax (EBIT) exhibited notable volatility, starting at 3,007 million USD in March 2022 and declining to a period low of 1,474 million USD by December 2022. A sustained recovery period followed, with EBIT increasing steadily to peak at 2,478 million USD by December 2025. However, a subsequent contraction occurred in early 2026, with figures dropping to 1,623 million USD in March before partially recovering to 1,875 million USD in June 2026.
- Cost of Debt Servicing
- Interest expenses remained relatively stable for the majority of the timeframe, fluctuating between 120 million USD and 166 million USD from March 2022 through December 2025. This stability shifted abruptly in the first half of 2026, where interest expenses rose to 174 million USD in March and spiked to 351 million USD by June 2026, representing a substantial increase in financing costs.
- Interest Coverage Ratio Analysis
- The interest coverage ratio mirrors the interplay between operating earnings and financing costs. The ratio initially declined from a peak of 20.07 in June 2022 to a trough of 10.79 in September 2023, a movement primarily driven by the contraction in EBIT. A recovery phase ensued, with the ratio returning to 18.17 by December 2025 as EBIT grew while interest expenses remained flat. This trend reversed sharply in the first half of 2026; the simultaneous occurrence of EBIT volatility and a surge in interest expenses led the ratio to fall to 10.81 by June 2026, indicating a diminished capacity to cover interest obligations compared to the previous year.
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