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)
Eaton Corp. plc, solvency ratios (quarterly data)
Based on: 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), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
- Debt to Equity
- The debt to equity ratio exhibits a general downward trend from early 2021 through the end of 2024, moving from 0.68 in March 2021 to a low around 0.48-0.49 during 2023-2024. However, in 2025, there is a noticeable increase again, reaching approximately 0.59 by June 2025. This indicates a period of deleveraging followed by a re-leveraging phase.
- Debt to Equity (including operating lease liability)
- The pattern here mirrors the standard debt to equity ratio, starting at 0.7 in Q1 2021, declining to about 0.51 by late 2023, and then rising to 0.62 by mid-2025. This suggests that operating lease liabilities follow a similar risk profile in relation to equity.
- Debt to Capital
- Debt to capital ratio trends generally downward from 0.40 in early 2021 to roughly 0.32-0.33 during 2023-2024, before a moderate increase to 0.37 by mid-2025. The trend implies improved capital structure efficiency for most of the period, with a slight tilt towards increased leverage in the most recent quarters.
- Debt to Capital (including operating lease liability)
- This ratio follows a close trajectory to the debt to capital ratio, starting at 0.41 and showing similarly subdued fluctuations with a minimum near 0.34 before inching upward to 0.38 by mid-2025, reflecting the inclusion of operating leases in total liabilities.
- Debt to Assets
- The debt to assets ratio reveals a decline from 0.30 to about 0.24 between early 2021 and late 2023, indicating a reduction in the proportion of assets financed by debt. There is a mild increase to 0.27 by mid-2025, marking a small uptick in leverage against total assets later in the period.
- Debt to Assets (including operating lease liability)
- This ratio maintains a similar trend but slightly higher values due to operating lease liabilities. The trend shows a decrease from 0.31 to 0.25 and a gentle rise to 0.29 by 2025, reaffirming the incremental impact of lease obligations on asset financing.
- Financial Leverage
- Financial leverage decreases from 2.27 in Q1 2021 to a low of approximately 2.00 between late 2023 and early 2024, suggesting a reduction in the use of debt relative to equity. From this trough, leverage gradually increases, reaching 2.18 by mid-2025, reflecting a modest return to increased borrowing or reduced equity base.
- Interest Coverage
- The interest coverage ratio shows a strong upward trend across the entire period, beginning at 11.87 in March 2021 and peaking at 40.37 in Q3 2024 before a slight decrease to 28.05 by mid-2025. This improvement denotes increased earnings relative to interest expense, indicating enhanced ability to service debt.
Overall, the financial leverage and debt-related ratios depict a period of deleveraging and improved balance sheet strength predominantly between 2021 and 2023, followed by a gradual increase in leverage starting in late 2024. Concurrently, the substantial rise in interest coverage suggests improved operational earnings or reduced interest expenses, enhancing debt servicing capacity throughout the timeframe.
Debt Ratios
Coverage Ratios
Debt to Equity
Eaton Corp. plc, debt to equity calculation (quarterly data)
| 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||
| Short-term debt | 1,111) | 805) | —) | 3) | 4) | 1) | 8) | 24) | 94) | 87) | 324) | 903) | 1,392) | 1,116) | 13) | 428) | 3,373) | 464) | ||||||
| Current portion of long-term debt | 1,134) | 1,666) | 674) | 714) | 1,278) | 994) | 1,017) | 975) | 402) | 8) | 10) | 23) | 2,030) | 1,728) | 1,735) | 116) | 8) | 1,012) | ||||||
| Long-term debt, excluding current portion | 8,751) | 7,609) | 8,478) | 8,678) | 8,555) | 8,192) | 8,244) | 8,150) | 8,804) | 8,701) | 8,321) | 8,082) | 6,277) | 6,763) | 6,831) | 8,520) | 8,721) | 8,682) | ||||||
| Total debt | 10,996) | 10,080) | 9,152) | 9,395) | 9,837) | 9,187) | 9,269) | 9,149) | 9,300) | 8,796) | 8,655) | 9,008) | 9,699) | 9,607) | 8,579) | 9,064) | 12,102) | 10,158) | ||||||
| Total Eaton shareholders’ equity | 18,606) | 18,506) | 18,488) | 19,117) | 19,219) | 19,292) | 19,036) | 18,383) | 17,953) | 17,449) | 17,038) | 16,068) | 16,380) | 16,620) | 16,413) | 15,971) | 15,408) | 14,995) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to equity1 | 0.59 | 0.54 | 0.50 | 0.49 | 0.51 | 0.48 | 0.49 | 0.50 | 0.52 | 0.50 | 0.51 | 0.56 | 0.59 | 0.58 | 0.52 | 0.57 | 0.79 | 0.68 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Equity, Competitors2 | ||||||||||||||||||||||||
| Boeing Co. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Caterpillar Inc. | 2.18 | 2.14 | 1.97 | 1.95 | 2.18 | 2.15 | 1.94 | 1.81 | 2.07 | 2.04 | 2.33 | 2.34 | 2.35 | 2.20 | 2.29 | 2.21 | 2.23 | 2.30 | ||||||
| GE Aerospace | 0.99 | 1.02 | 1.00 | 1.06 | 1.06 | 0.69 | 0.77 | 0.73 | 0.70 | 0.71 | 0.89 | 0.97 | 0.94 | 0.86 | 0.87 | 1.68 | 1.90 | 2.12 | ||||||
| Honeywell International Inc. | 2.27 | 1.88 | 1.67 | 1.77 | 1.65 | 1.53 | 1.29 | 1.18 | 1.24 | 1.13 | 1.17 | 0.96 | 1.09 | 1.05 | 1.06 | 1.19 | 1.19 | 1.19 | ||||||
| Lockheed Martin Corp. | 4.06 | 3.04 | 3.20 | 2.68 | 3.12 | 2.92 | 2.55 | 1.88 | 1.90 | 1.62 | 1.68 | 0.96 | 1.02 | 1.16 | 1.07 | 1.21 | 1.87 | 1.93 | ||||||
| RTX Corp. | 0.67 | 0.67 | 0.69 | 0.69 | 0.71 | 0.71 | 0.73 | 0.51 | 0.49 | 0.47 | 0.44 | 0.48 | 0.45 | 0.43 | 0.43 | 0.44 | 0.44 | 0.44 | ||||||
Based on: 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), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q2 2025 Calculation
Debt to equity = Total debt ÷ Total Eaton shareholders’ equity
= 10,996 ÷ 18,606 = 0.59
2 Click competitor name to see calculations.
The financial data reveals several noteworthy trends regarding the company's leverage and equity base over the observed periods. Total debt exhibits fluctuations but generally remains within a moderate range, with some increases observed toward the later periods.
- Total Debt
-
Total debt shows variability across the quarters. Initially, there is a rise from approximately 10,158 million to a peak near 12,102 million in mid-2021, followed by a decline toward the end of 2021. Through 2022 and early 2023, total debt stabilizes around the 8,600 to 9,300 million range. However, from mid-2023 onward, there is a gradual increase, culminating in a level exceeding 10,900 million by mid-2025.
- Total Eaton Shareholders' Equity
-
Shareholders' equity exhibits a generally upward trajectory over the entire timeframe. Starting at about 14,995 million at the beginning of 2021, equity increases consistently with some minor fluctuations, peaking near 19,292 million in early 2024. Afterward, there is a slight decline, bringing equity close to 18,606 million by mid-2025. This growth suggests an overall strengthening of the equity base in the medium term before the minor reduction toward the end.
- Debt to Equity Ratio
-
The debt to equity ratio fluctuates pleasingly between approximately 0.49 and 0.79, indicating moderate leverage. The highest points occur in mid-2021 at 0.79, after which the ratio steadily declines to the low 0.5 range by late 2022 and early 2023. The subsequent trend shows a slight increase moving into mid-2025, with the ratio rising back to approximately 0.59. This implies that leverage was reduced during 2021-2023, followed by a modest increase in debt relative to equity in the latest periods.
In summary, the data indicates a company managing its debt levels prudently with a trend toward reducing leverage in the early years followed by a measured increase later. Meanwhile, shareholders’ equity expanded substantially over the longer term, reflecting accumulation of retained earnings or equity injections, though a minor contraction is visible in the final periods. The interplay of these elements leads to a debt to equity ratio that remains in a conservative range, signaling an overall balanced capital structure with trending adjustments reflecting dynamic financial management.
Debt to Equity (including Operating Lease Liability)
Eaton Corp. plc, debt to equity (including operating lease liability) calculation (quarterly data)
| 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||
| Short-term debt | 1,111) | 805) | —) | 3) | 4) | 1) | 8) | 24) | 94) | 87) | 324) | 903) | 1,392) | 1,116) | 13) | 428) | 3,373) | 464) | ||||||
| Current portion of long-term debt | 1,134) | 1,666) | 674) | 714) | 1,278) | 994) | 1,017) | 975) | 402) | 8) | 10) | 23) | 2,030) | 1,728) | 1,735) | 116) | 8) | 1,012) | ||||||
| Long-term debt, excluding current portion | 8,751) | 7,609) | 8,478) | 8,678) | 8,555) | 8,192) | 8,244) | 8,150) | 8,804) | 8,701) | 8,321) | 8,082) | 6,277) | 6,763) | 6,831) | 8,520) | 8,721) | 8,682) | ||||||
| Total debt | 10,996) | 10,080) | 9,152) | 9,395) | 9,837) | 9,187) | 9,269) | 9,149) | 9,300) | 8,796) | 8,655) | 9,008) | 9,699) | 9,607) | 8,579) | 9,064) | 12,102) | 10,158) | ||||||
| Noncurrent operating lease liabilities | 587) | 669) | 669) | 681) | 656) | 601) | 533) | 486) | 482) | 466) | 459) | 447) | 386) | 342) | 337) | 343) | 366) | 328) | ||||||
| Total debt (including operating lease liability) | 11,583) | 10,749) | 9,821) | 10,076) | 10,493) | 9,788) | 9,802) | 9,635) | 9,782) | 9,262) | 9,114) | 9,455) | 10,085) | 9,949) | 8,916) | 9,407) | 12,468) | 10,486) | ||||||
| Total Eaton shareholders’ equity | 18,606) | 18,506) | 18,488) | 19,117) | 19,219) | 19,292) | 19,036) | 18,383) | 17,953) | 17,449) | 17,038) | 16,068) | 16,380) | 16,620) | 16,413) | 15,971) | 15,408) | 14,995) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to equity (including operating lease liability)1 | 0.62 | 0.58 | 0.53 | 0.53 | 0.55 | 0.51 | 0.51 | 0.52 | 0.54 | 0.53 | 0.53 | 0.59 | 0.62 | 0.60 | 0.54 | 0.59 | 0.81 | 0.70 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Equity (including Operating Lease Liability), Competitors2 | ||||||||||||||||||||||||
| RTX Corp. | 0.70 | 0.70 | 0.71 | 0.72 | 0.74 | 0.73 | 0.76 | 0.53 | 0.51 | 0.50 | 0.46 | 0.50 | 0.47 | 0.46 | 0.45 | 0.46 | 0.46 | 0.46 | ||||||
Based on: 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), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q2 2025 Calculation
Debt to equity (including operating lease liability) = Total debt (including operating lease liability) ÷ Total Eaton shareholders’ equity
= 11,583 ÷ 18,606 = 0.62
2 Click competitor name to see calculations.
- Total debt (including operating lease liability)
- The total debt presents a fluctuating trend across the observed quarters. Initially, there was a substantial increase from approximately 10.5 billion USD to 12.5 billion USD by mid-2021, followed by a notable decline towards the end of 2021, reaching roughly 8.9 billion USD. Subsequently, the debt level showed moderate variation, generally oscillating between 9 and 10.5 billion USD until late 2024. From early 2025 onward, the total debt increased noticeably, peaking at about 11.6 billion USD by mid-2025. This pattern suggests periods of debt reduction and accumulation, with recent quarters indicating renewed borrowing or liability recognition.
- Total Eaton shareholders’ equity
- Shareholders’ equity displayed a steady and consistent growth over the entire period. Starting from approximately 15 billion USD in early 2021, equity rose gradually each quarter, crossing the 19 billion USD mark by the end of 2023. After reaching a peak close to 19.3 billion USD in early 2024, equity saw minor fluctuations but remained relatively stable, maintaining levels slightly above 18 billion USD through mid-2025. The overall upward trajectory reflects sustained value creation or accumulation of retained earnings despite some recent stabilization.
- Debt to equity ratio (including operating lease liability)
- The debt to equity ratio exhibited an initially elevated ratio near 0.8 in mid-2021, followed by a steady decline through the remainder of that year to approximately 0.5. This indicates an improvement in the company’s leverage position. During 2022 and early 2023, the ratio maintained a stable range just above 0.5, implying a balanced capital structure with moderate leverage. From late 2023 onward, the ratio began to increase again, rising to about 0.62 by mid-2025. This upward movement in the ratio suggests a gradual increase in leverage relative to equity, consistent with the observed rise in total debt in the recent periods.
- Summary
- The financial data reveal a company managing a dynamic capital structure, with periods of significant debt reduction followed by phases of incremental borrowing. The steady growth in shareholders’ equity indicates ongoing value accumulation. However, the recent increase in debt relative to equity warrants attention as it reflects rising leverage, which could impact financial risk. This evolving interplay between debt and equity highlights the necessity for continuous monitoring to ensure financial stability and optimal capital allocation.
Debt to Capital
Eaton Corp. plc, debt to capital calculation (quarterly data)
| 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||
| Short-term debt | 1,111) | 805) | —) | 3) | 4) | 1) | 8) | 24) | 94) | 87) | 324) | 903) | 1,392) | 1,116) | 13) | 428) | 3,373) | 464) | ||||||
| Current portion of long-term debt | 1,134) | 1,666) | 674) | 714) | 1,278) | 994) | 1,017) | 975) | 402) | 8) | 10) | 23) | 2,030) | 1,728) | 1,735) | 116) | 8) | 1,012) | ||||||
| Long-term debt, excluding current portion | 8,751) | 7,609) | 8,478) | 8,678) | 8,555) | 8,192) | 8,244) | 8,150) | 8,804) | 8,701) | 8,321) | 8,082) | 6,277) | 6,763) | 6,831) | 8,520) | 8,721) | 8,682) | ||||||
| Total debt | 10,996) | 10,080) | 9,152) | 9,395) | 9,837) | 9,187) | 9,269) | 9,149) | 9,300) | 8,796) | 8,655) | 9,008) | 9,699) | 9,607) | 8,579) | 9,064) | 12,102) | 10,158) | ||||||
| Total Eaton shareholders’ equity | 18,606) | 18,506) | 18,488) | 19,117) | 19,219) | 19,292) | 19,036) | 18,383) | 17,953) | 17,449) | 17,038) | 16,068) | 16,380) | 16,620) | 16,413) | 15,971) | 15,408) | 14,995) | ||||||
| Total capital | 29,602) | 28,586) | 27,640) | 28,512) | 29,056) | 28,479) | 28,305) | 27,532) | 27,253) | 26,245) | 25,693) | 25,076) | 26,079) | 26,227) | 24,992) | 25,035) | 27,510) | 25,153) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to capital1 | 0.37 | 0.35 | 0.33 | 0.33 | 0.34 | 0.32 | 0.33 | 0.33 | 0.34 | 0.34 | 0.34 | 0.36 | 0.37 | 0.37 | 0.34 | 0.36 | 0.44 | 0.40 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Capital, Competitors2 | ||||||||||||||||||||||||
| Boeing Co. | 1.07 | 1.07 | 1.08 | 1.69 | 1.45 | 1.55 | 1.49 | 1.47 | 1.42 | 1.39 | 1.39 | 1.45 | 1.35 | 1.36 | 1.35 | 1.30 | 1.36 | 1.40 | ||||||
| Caterpillar Inc. | 0.69 | 0.68 | 0.66 | 0.66 | 0.69 | 0.68 | 0.66 | 0.64 | 0.67 | 0.67 | 0.70 | 0.70 | 0.70 | 0.69 | 0.70 | 0.69 | 0.69 | 0.70 | ||||||
| GE Aerospace | 0.50 | 0.50 | 0.50 | 0.51 | 0.51 | 0.41 | 0.43 | 0.42 | 0.41 | 0.41 | 0.47 | 0.49 | 0.48 | 0.46 | 0.47 | 0.63 | 0.65 | 0.68 | ||||||
| Honeywell International Inc. | 0.69 | 0.65 | 0.63 | 0.64 | 0.62 | 0.61 | 0.56 | 0.54 | 0.55 | 0.53 | 0.54 | 0.49 | 0.52 | 0.51 | 0.51 | 0.54 | 0.54 | 0.54 | ||||||
| Lockheed Martin Corp. | 0.80 | 0.75 | 0.76 | 0.73 | 0.76 | 0.74 | 0.72 | 0.65 | 0.66 | 0.62 | 0.63 | 0.49 | 0.50 | 0.54 | 0.52 | 0.55 | 0.65 | 0.66 | ||||||
| RTX Corp. | 0.40 | 0.40 | 0.41 | 0.41 | 0.42 | 0.41 | 0.42 | 0.34 | 0.33 | 0.32 | 0.31 | 0.32 | 0.31 | 0.30 | 0.30 | 0.30 | 0.31 | 0.31 | ||||||
Based on: 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), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q2 2025 Calculation
Debt to capital = Total debt ÷ Total capital
= 10,996 ÷ 29,602 = 0.37
2 Click competitor name to see calculations.
The analysis of the financial data reveals several notable trends in the company's capital structure over the observed quarterly periods from March 2021 through June 2025.
- Total Debt
- The total debt figures exhibited considerable fluctuation throughout the period. The debt peaked early in June 2021 at 12,102 million USD, then generally declined reaching a low near 8,579 million USD by December 2021. A similar pattern of moderate increases and decreases continued in subsequent years. Notably, the debt increased again towards the middle and end of the 2024 and early 2025 periods, reaching up to approximately 10,996 million USD by June 2025. Overall, while there were rises and falls, the total debt remained mostly within a band from roughly 8,500 million to approximately 11,000 million USD in the latter years.
- Total Capital
- Total capital showed less volatility compared to total debt, maintaining a generally upward trajectory. Starting at about 25,153 million USD in March 2021, it experienced some fluctuations but trended upward over the four-year window, reaching nearly 29,602 million USD by June 2025. This indicates an increase in the company's financing base, suggesting potential organic growth or capital increases that outpaced debt variability.
- Debt to Capital Ratio
- The leverage ratio, defined as debt to capital, decreased significantly from 0.40 in March 2021 to around 0.33 by the end of 2021, reflecting a reduction in relative indebtedness. This ratio remained relatively stable during 2022 and 2023, fluctuating modestly between 0.32 and 0.35. However, from early 2024 through mid-2025, the debt to capital ratio showed an upward trend, increasing from 0.32 up to 0.37. This upward movement suggests a gradual increase in leverage, driven either by rising debt levels or slower growth in capital relative to debt. Despite this increase, the ratio remains below the initial levels observed in early 2021.
In summary, the company’s financial structure reveals controlled debt management with a tendency towards moderate leverage increases in the most recent periods. The steady growth in total capital alongside fluctuating debt levels suggests balanced capital composition, though the recent rise in debt to capital ratio warrants monitoring to ensure sustainable financial risk levels.
Debt to Capital (including Operating Lease Liability)
Eaton Corp. plc, debt to capital (including operating lease liability) calculation (quarterly data)
| 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||
| Short-term debt | 1,111) | 805) | —) | 3) | 4) | 1) | 8) | 24) | 94) | 87) | 324) | 903) | 1,392) | 1,116) | 13) | 428) | 3,373) | 464) | ||||||
| Current portion of long-term debt | 1,134) | 1,666) | 674) | 714) | 1,278) | 994) | 1,017) | 975) | 402) | 8) | 10) | 23) | 2,030) | 1,728) | 1,735) | 116) | 8) | 1,012) | ||||||
| Long-term debt, excluding current portion | 8,751) | 7,609) | 8,478) | 8,678) | 8,555) | 8,192) | 8,244) | 8,150) | 8,804) | 8,701) | 8,321) | 8,082) | 6,277) | 6,763) | 6,831) | 8,520) | 8,721) | 8,682) | ||||||
| Total debt | 10,996) | 10,080) | 9,152) | 9,395) | 9,837) | 9,187) | 9,269) | 9,149) | 9,300) | 8,796) | 8,655) | 9,008) | 9,699) | 9,607) | 8,579) | 9,064) | 12,102) | 10,158) | ||||||
| Noncurrent operating lease liabilities | 587) | 669) | 669) | 681) | 656) | 601) | 533) | 486) | 482) | 466) | 459) | 447) | 386) | 342) | 337) | 343) | 366) | 328) | ||||||
| Total debt (including operating lease liability) | 11,583) | 10,749) | 9,821) | 10,076) | 10,493) | 9,788) | 9,802) | 9,635) | 9,782) | 9,262) | 9,114) | 9,455) | 10,085) | 9,949) | 8,916) | 9,407) | 12,468) | 10,486) | ||||||
| Total Eaton shareholders’ equity | 18,606) | 18,506) | 18,488) | 19,117) | 19,219) | 19,292) | 19,036) | 18,383) | 17,953) | 17,449) | 17,038) | 16,068) | 16,380) | 16,620) | 16,413) | 15,971) | 15,408) | 14,995) | ||||||
| Total capital (including operating lease liability) | 30,189) | 29,255) | 28,309) | 29,193) | 29,712) | 29,080) | 28,838) | 28,018) | 27,735) | 26,711) | 26,152) | 25,523) | 26,465) | 26,569) | 25,329) | 25,378) | 27,876) | 25,481) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to capital (including operating lease liability)1 | 0.38 | 0.37 | 0.35 | 0.35 | 0.35 | 0.34 | 0.34 | 0.34 | 0.35 | 0.35 | 0.35 | 0.37 | 0.38 | 0.37 | 0.35 | 0.37 | 0.45 | 0.41 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Capital (including Operating Lease Liability), Competitors2 | ||||||||||||||||||||||||
| RTX Corp. | 0.41 | 0.41 | 0.42 | 0.42 | 0.42 | 0.42 | 0.43 | 0.35 | 0.34 | 0.33 | 0.32 | 0.33 | 0.32 | 0.31 | 0.31 | 0.31 | 0.32 | 0.32 | ||||||
Based on: 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), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q2 2025 Calculation
Debt to capital (including operating lease liability) = Total debt (including operating lease liability) ÷ Total capital (including operating lease liability)
= 11,583 ÷ 30,189 = 0.38
2 Click competitor name to see calculations.
- Total debt (including operating lease liability)
- The total debt exhibited significant fluctuations over the examined periods. It initially increased sharply from approximately 10,486 million USD to 12,468 million USD by mid-2021, before declining to below 9,500 million USD by the end of that year. Throughout 2022 and into early 2023, the debt levels remained relatively stable, hovering around 9,000 to 10,000 million USD. Starting mid-2023, there was a general upward trend, culminating in a peak of 11,583 million USD by mid-2025. This pattern suggests periods of both debt reduction and new borrowing, with a net increase in debt towards the latter periods.
- Total capital (including operating lease liability)
- Total capital showed a moderate overall upward trend across the observed timeframe. From an initial value of roughly 25,481 million USD in early 2021, it gradually increased with some minor variations, reaching around 30,189 million USD by mid-2025. The trajectory indicates steady growth in the company's capital base, with occasional fluctuations likely reflecting changes in financing structure or operational investment activity.
- Debt to capital ratio (including operating lease liability)
- The debt to capital ratio displayed variability that aligns with the changes observed in total debt and capital. It rose to a peak of 0.45 in mid-2021, reflecting the increase in debt relative to capital at that time. Following this peak, the ratio declined and stabilized around 0.34 to 0.35 through late 2022 into early 2024, indicating a more balanced capital structure with less reliance on debt. Starting mid-2024, the ratio gently rose again, reaching 0.38 by mid-2025, consistent with the concurrent increase in total debt relative to capital. This suggests a cautious increase in leverage in the most recent periods.
Debt to Assets
Eaton Corp. plc, debt to assets calculation (quarterly data)
| 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||
| Short-term debt | 1,111) | 805) | —) | 3) | 4) | 1) | 8) | 24) | 94) | 87) | 324) | 903) | 1,392) | 1,116) | 13) | 428) | 3,373) | 464) | ||||||
| Current portion of long-term debt | 1,134) | 1,666) | 674) | 714) | 1,278) | 994) | 1,017) | 975) | 402) | 8) | 10) | 23) | 2,030) | 1,728) | 1,735) | 116) | 8) | 1,012) | ||||||
| Long-term debt, excluding current portion | 8,751) | 7,609) | 8,478) | 8,678) | 8,555) | 8,192) | 8,244) | 8,150) | 8,804) | 8,701) | 8,321) | 8,082) | 6,277) | 6,763) | 6,831) | 8,520) | 8,721) | 8,682) | ||||||
| Total debt | 10,996) | 10,080) | 9,152) | 9,395) | 9,837) | 9,187) | 9,269) | 9,149) | 9,300) | 8,796) | 8,655) | 9,008) | 9,699) | 9,607) | 8,579) | 9,064) | 12,102) | 10,158) | ||||||
| Total assets | 40,507) | 39,206) | 38,381) | 39,236) | 39,381) | 38,535) | 38,432) | 37,289) | 36,772) | 35,517) | 35,014) | 34,364) | 35,153) | 35,208) | 34,027) | 34,128) | 36,804) | 34,080) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to assets1 | 0.27 | 0.26 | 0.24 | 0.24 | 0.25 | 0.24 | 0.24 | 0.25 | 0.25 | 0.25 | 0.25 | 0.26 | 0.28 | 0.27 | 0.25 | 0.27 | 0.33 | 0.30 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Assets, Competitors2 | ||||||||||||||||||||||||
| Boeing Co. | 0.34 | 0.34 | 0.34 | 0.42 | 0.41 | 0.36 | 0.38 | 0.39 | 0.39 | 0.41 | 0.42 | 0.42 | 0.42 | 0.43 | 0.42 | 0.43 | 0.43 | 0.42 | ||||||
| Caterpillar Inc. | 0.45 | 0.45 | 0.44 | 0.44 | 0.45 | 0.45 | 0.43 | 0.43 | 0.44 | 0.44 | 0.45 | 0.45 | 0.46 | 0.46 | 0.46 | 0.46 | 0.46 | 0.47 | ||||||
| GE Aerospace | 0.15 | 0.16 | 0.16 | 0.16 | 0.16 | 0.13 | 0.13 | 0.13 | 0.13 | 0.14 | 0.17 | 0.17 | 0.18 | 0.18 | 0.18 | 0.27 | 0.27 | 0.29 | ||||||
| Honeywell International Inc. | 0.47 | 0.44 | 0.41 | 0.42 | 0.40 | 0.38 | 0.33 | 0.33 | 0.34 | 0.32 | 0.31 | 0.28 | 0.31 | 0.31 | 0.30 | 0.33 | 0.33 | 0.34 | ||||||
| Lockheed Martin Corp. | 0.37 | 0.36 | 0.36 | 0.35 | 0.35 | 0.35 | 0.33 | 0.31 | 0.31 | 0.29 | 0.29 | 0.22 | 0.22 | 0.23 | 0.23 | 0.23 | 0.23 | 0.24 | ||||||
| RTX Corp. | 0.25 | 0.25 | 0.25 | 0.26 | 0.26 | 0.27 | 0.27 | 0.22 | 0.22 | 0.21 | 0.20 | 0.21 | 0.20 | 0.20 | 0.20 | 0.20 | 0.20 | 0.20 | ||||||
Based on: 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), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q2 2025 Calculation
Debt to assets = Total debt ÷ Total assets
= 10,996 ÷ 40,507 = 0.27
2 Click competitor name to see calculations.
- Total Debt
-
Total debt exhibited notable fluctuations over the observed periods. Starting at approximately 10.2 billion USD in the first quarter of 2021, it increased to over 12.1 billion by the second quarter of the same year, marking the highest level in 2021. Subsequently, total debt decreased steadily through the end of 2021, reaching about 8.6 billion USD.
In 2022, total debt remained relatively stable, oscillating between approximately 8.6 billion and 9.7 billion USD. This stability persisted into the early quarters of 2023, with values generally around 9.0 billion USD. However, from the first quarter of 2024 onwards, there was a slight upward trend, culminating in a peak of nearly 11.0 billion by mid-2025.
- Total Assets
-
Total assets followed a generally upward trajectory throughout the period. Beginning at just over 34 billion USD in early 2021, the asset base exhibited moderate growth with some quarter-to-quarter variability. Notably, after a period of relative flatness in late 2021 and early 2022, total assets resumed growth from mid-2022 onwards.
By the end of 2023, total assets had increased to approximately 38.4 billion USD and continued growing steadily, reaching over 40.5 billion USD by the second quarter of 2025. This represents a growth of nearly 19% in total assets over the examined timeframe.
- Debt to Assets Ratio
-
The ratio of total debt to total assets demonstrated a declining trend in 2021, starting at 0.30 and dropping to 0.25 by year's end, indicating an improving leverage position despite some debt increases earlier in the year.
Throughout 2022 and 2023, the ratio stabilized around 0.24 to 0.25, reflecting a period of balanced debt management relative to asset growth. In 2024 and into mid-2025, the ratio exhibited a slight upward trend, rising to approximately 0.27, which suggests a moderate increase in leverage as debt growth somewhat outpaced asset accumulation.
- Summary Insights
-
The overall analysis reveals a profile of steady asset growth accompanied by periods of debt fluctuation. The company maintained a relatively conservative leverage ratio, generally keeping debt at around one-quarter of total assets. The recent slight increase in leverage towards mid-2025 warrants monitoring, as it may indicate a shift in financing strategy or capital structure.
The data suggests effective asset base expansion possibly aligned with strategic investments or operational growth. The management of debt appears cautious, with prior reductions following spikes and stabilization thereafter, aligning with longer-term fiscal prudence.
Debt to Assets (including Operating Lease Liability)
Eaton Corp. plc, debt to assets (including operating lease liability) calculation (quarterly data)
| 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 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||
| Short-term debt | 1,111) | 805) | —) | 3) | 4) | 1) | 8) | 24) | 94) | 87) | 324) | 903) | 1,392) | 1,116) | 13) | 428) | 3,373) | 464) | ||||||
| Current portion of long-term debt | 1,134) | 1,666) | 674) | 714) | 1,278) | 994) | 1,017) | 975) | 402) | 8) | 10) | 23) | 2,030) | 1,728) | 1,735) | 116) | 8) | 1,012) | ||||||
| Long-term debt, excluding current portion | 8,751) | 7,609) | 8,478) | 8,678) | 8,555) | 8,192) | 8,244) | 8,150) | 8,804) | 8,701) | 8,321) | 8,082) | 6,277) | 6,763) | 6,831) | 8,520) | 8,721) | 8,682) | ||||||
| Total debt | 10,996) | 10,080) | 9,152) | 9,395) | 9,837) | 9,187) | 9,269) | 9,149) | 9,300) | 8,796) | 8,655) | 9,008) | 9,699) | 9,607) | 8,579) | 9,064) | 12,102) | 10,158) | ||||||
| Noncurrent operating lease liabilities | 587) | 669) | 669) | 681) | 656) | 601) | 533) | 486) | 482) | 466) | 459) | 447) | 386) | 342) | 337) | 343) | 366) | 328) | ||||||
| Total debt (including operating lease liability) | 11,583) | 10,749) | 9,821) | 10,076) | 10,493) | 9,788) | 9,802) | 9,635) | 9,782) | 9,262) | 9,114) | 9,455) | 10,085) | 9,949) | 8,916) | 9,407) | 12,468) | 10,486) | ||||||
| Total assets | 40,507) | 39,206) | 38,381) | 39,236) | 39,381) | 38,535) | 38,432) | 37,289) | 36,772) | 35,517) | 35,014) | 34,364) | 35,153) | 35,208) | 34,027) | 34,128) | 36,804) | 34,080) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Debt to assets (including operating lease liability)1 | 0.29 | 0.27 | 0.26 | 0.26 | 0.27 | 0.25 | 0.26 | 0.26 | 0.27 | 0.26 | 0.26 | 0.28 | 0.29 | 0.28 | 0.26 | 0.28 | 0.34 | 0.31 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Debt to Assets (including Operating Lease Liability), Competitors2 | ||||||||||||||||||||||||
| RTX Corp. | 0.26 | 0.26 | 0.26 | 0.27 | 0.27 | 0.28 | 0.28 | 0.23 | 0.23 | 0.22 | 0.21 | 0.22 | 0.21 | 0.21 | 0.21 | 0.21 | 0.21 | 0.21 | ||||||
Based on: 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), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q2 2025 Calculation
Debt to assets (including operating lease liability) = Total debt (including operating lease liability) ÷ Total assets
= 11,583 ÷ 40,507 = 0.29
2 Click competitor name to see calculations.
The analysis of the quarterly financial data reveals several notable trends regarding debt levels, asset volumes, and leverage ratios over the examined periods.
- Total Debt (Including Operating Lease Liability)
-
Total debt exhibited fluctuations throughout the period. Starting at approximately $10.5 billion in early 2021, debt increased to around $12.5 billion in the second quarter of 2021 before declining steadily to just above $9 billion by the end of that year. During 2022, debt remained relatively stable with minor variances, staying in the $9.1 billion to $10.1 billion range. Moving into 2023 and 2024, total debt showed a generally upward trajectory, peaking close to $11.6 billion by mid-2025. Overall, debt increased moderately in the latter part of the analyzed timeframe after prior reductions in 2021.
- Total Assets
-
Total assets demonstrated a gradual upward trend over the timeframe. Initial values near $34 billion in early 2021 increased slightly to about $37 billion by mid-2021, followed by a modest decline to around $34 billion at the end of 2021. Asset levels then recovered and continued to climb steadily into 2023 and 2024, reaching upwards of $40.5 billion by mid-2025. This trend indicates consistent asset growth across the years, albeit with some short-term fluctuations.
- Debt to Assets Ratio (Including Operating Lease Liability)
-
The debt to assets ratio reflected the interplay between changes in debt and asset values. Starting at approximately 0.31 in early 2021, the ratio rose to 0.34 in the second quarter, corresponding with peak debt levels. Subsequently, the ratio declined to a low near 0.25 in early 2024, consistent with stabilizing or increasing asset bases and controlled debt. However, the ratio increased again towards mid-2025 to 0.29, aligning with the renewed rise in total debt. Overall, the company maintained a leverage ratio generally between 0.25 and 0.34, suggesting moderate leverage with some variability tied to debt and asset movements.
In summary, the company displayed a pattern of managing its debt levels with periodic increases and reductions, while total assets predominantly expanded over the period. This combination resulted in a relatively stable leverage ratio, reflecting a balance between leveraging opportunities and asset growth. The incremental rise in debt and assets toward the end of the period suggests ongoing investment activities or financing adjustments requiring attention to future leverage implications.
Financial Leverage
Eaton Corp. plc, financial leverage calculation (quarterly data)
| Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||
| Total assets | 40,507) | 39,206) | 38,381) | 39,236) | 39,381) | 38,535) | 38,432) | 37,289) | 36,772) | 35,517) | 35,014) | 34,364) | 35,153) | 35,208) | 34,027) | 34,128) | 36,804) | 34,080) | ||||||
| Total Eaton shareholders’ equity | 18,606) | 18,506) | 18,488) | 19,117) | 19,219) | 19,292) | 19,036) | 18,383) | 17,953) | 17,449) | 17,038) | 16,068) | 16,380) | 16,620) | 16,413) | 15,971) | 15,408) | 14,995) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Financial leverage1 | 2.18 | 2.12 | 2.08 | 2.05 | 2.05 | 2.00 | 2.02 | 2.03 | 2.05 | 2.04 | 2.06 | 2.14 | 2.15 | 2.12 | 2.07 | 2.14 | 2.39 | 2.27 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Financial Leverage, Competitors2 | ||||||||||||||||||||||||
| Boeing Co. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||
| Caterpillar Inc. | 4.84 | 4.70 | 4.50 | 4.45 | 4.86 | 4.75 | 4.49 | 4.24 | 4.68 | 4.61 | 5.16 | 5.19 | 5.16 | 4.82 | 5.02 | 4.85 | 4.85 | 4.87 | ||||||
| GE Aerospace | 6.55 | 6.45 | 6.37 | 6.71 | 6.62 | 5.49 | 5.96 | 5.47 | 5.23 | 5.20 | 5.16 | 5.75 | 5.35 | 4.92 | 4.93 | 6.33 | 7.09 | 7.30 | ||||||
| Honeywell International Inc. | 4.87 | 4.31 | 4.04 | 4.22 | 4.09 | 3.99 | 3.88 | 3.56 | 3.60 | 3.54 | 3.73 | 3.40 | 3.55 | 3.45 | 3.47 | 3.60 | 3.56 | 3.53 | ||||||
| Lockheed Martin Corp. | 11.04 | 8.48 | 8.78 | 7.71 | 8.92 | 8.27 | 7.67 | 6.11 | 6.17 | 5.66 | 5.71 | 4.35 | 4.53 | 5.15 | 4.64 | 5.38 | 7.99 | 8.15 | ||||||
| RTX Corp. | 2.68 | 2.68 | 2.71 | 2.70 | 2.73 | 2.65 | 2.71 | 2.33 | 2.24 | 2.22 | 2.19 | 2.25 | 2.26 | 2.20 | 2.21 | 2.23 | 2.23 | 2.24 | ||||||
Based on: 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), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q2 2025 Calculation
Financial leverage = Total assets ÷ Total Eaton shareholders’ equity
= 40,507 ÷ 18,606 = 2.18
2 Click competitor name to see calculations.
- Total Assets
-
Total assets exhibited fluctuations over the analyzed periods, starting at approximately $34.1 billion at the end of March 2021 and rising to about $35.2 billion by March 2022. Following this, assets generally trended upward, reaching a peak close to $39.4 billion by June 2024. A slight decrease occurred in the latter quarters, with total assets settling near $40.5 billion by June 2025. Overall, total assets showed a growth trajectory with periodic oscillations but ended significantly higher than the initial value.
- Total Eaton Shareholders’ Equity
-
Shareholders' equity reflected a consistent upward trend initially, increasing from around $15.0 billion in March 2021 to approximately $19.3 billion by December 2023. However, after peaking in late 2023 and early 2024, equity levels slightly declined and stabilized near the $18.6 billion mark by June 2025. The pattern suggests strong equity growth during the early periods followed by a modest contraction and stabilization in recent quarters.
- Financial Leverage Ratio
-
The financial leverage ratio displayed a general tendency to decrease from 2.27 at the start of the period to around 2.00 by early 2024, indicating a reduction in leverage and potentially a stronger equity position relative to debt. From mid-2024 onwards, the ratio experienced a gradual increase, reaching approximately 2.18 by June 2025. This rise implies a moderate increase in leverage in the latter periods, though overall levels remain lower than at the beginning of the analyzed timeframe.
- Summary of Financial Trends
-
Across the analyzed periods, there is clear evidence of asset growth accompanied by initial equity strengthening and a reduction in financial leverage. The latter portion of the timeline shows a stabilization or slight reversal in these trends, specifically in shareholders' equity and leverage levels. These dynamics suggest an initial phase of balance sheet strengthening followed by cautious re-leveraging and equity adjustments toward the end of the observed timeframe.
Interest Coverage
Eaton Corp. plc, interest coverage calculation (quarterly data)
| Jun 30, 2025 | Mar 31, 2025 | Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | Dec 31, 2023 | Sep 30, 2023 | Jun 30, 2023 | Mar 31, 2023 | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Sep 30, 2021 | Jun 30, 2021 | Mar 31, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||
| Net income attributable to Eaton ordinary shareholders | 982) | 964) | 971) | 1,009) | 993) | 821) | 945) | 891) | 744) | 638) | 722) | 607) | 601) | 532) | 551) | 629) | 506) | 458) | ||||||
| Add: Net income attributable to noncontrolling interest | —) | 1) | —) | 2) | 1) | 1) | 2) | 1) | 1) | 1) | 2) | 1) | —) | 1) | —) | 1) | —) | 1) | ||||||
| Add: Income tax expense | 204) | 212) | 195) | 193) | 201) | 179) | 141) | 187) | 153) | 123) | 128) | 112) | 119) | 86) | 74) | 483) | 114) | 79) | ||||||
| Add: Interest expense, net | 71) | 33) | 42) | 29) | 29) | 30) | 26) | 33) | 42) | 50) | 44) | 37) | 31) | 32) | 32) | 37) | 37) | 38) | ||||||
| Earnings before interest and tax (EBIT) | 1,257) | 1,210) | 1,208) | 1,233) | 1,224) | 1,031) | 1,114) | 1,112) | 940) | 812) | 896) | 757) | 751) | 651) | 657) | 1,150) | 657) | 576) | ||||||
| Solvency Ratio | ||||||||||||||||||||||||
| Interest coverage1 | 28.05 | 36.65 | 36.12 | 40.37 | 37.97 | 32.04 | 26.34 | 22.25 | 19.68 | 19.85 | 21.22 | 21.33 | 24.31 | 22.57 | 21.11 | 20.08 | 15.71 | 11.87 | ||||||
| Benchmarks | ||||||||||||||||||||||||
| Interest Coverage, Competitors2 | ||||||||||||||||||||||||
| Boeing Co. | -2.72 | -3.10 | -3.48 | -2.16 | -0.23 | 0.21 | 0.18 | -0.06 | -0.85 | -0.53 | -0.98 | -2.54 | -1.40 | -1.31 | -0.88 | -2.29 | -2.55 | -4.26 | ||||||
| Caterpillar Inc. | 25.81 | 26.67 | 27.21 | 26.28 | 26.88 | 27.68 | 26.66 | 24.81 | 23.80 | 21.33 | 20.80 | 22.05 | 20.08 | 19.10 | 17.88 | 14.11 | 11.79 | 9.28 | ||||||
| GE Aerospace | 11.46 | 9.44 | 8.73 | 7.93 | 6.25 | 6.11 | 10.12 | 9.41 | 8.49 | 6.73 | 1.88 | -1.66 | -1.16 | -1.49 | -0.96 | 2.15 | 1.11 | 0.65 | ||||||
| Honeywell International Inc. | 6.92 | 7.43 | 7.82 | 8.40 | 9.33 | 9.89 | 10.36 | 10.68 | 12.45 | 14.34 | 16.41 | 20.95 | 20.60 | 21.35 | 22.09 | 20.98 | 18.89 | 16.79 | ||||||
| Lockheed Martin Corp. | 5.60 | 7.12 | 7.00 | 8.65 | 8.83 | 9.19 | 9.84 | 10.42 | 11.74 | 10.58 | 11.72 | 13.31 | 10.88 | 14.12 | 14.27 | 13.67 | 15.97 | 15.44 | ||||||
Based on: 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), 10-K (reporting date: 2021-12-31), 10-Q (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31).
1 Q2 2025 Calculation
Interest coverage
= (EBITQ2 2025
+ EBITQ1 2025
+ EBITQ4 2024
+ EBITQ3 2024)
÷ (Interest expenseQ2 2025
+ Interest expenseQ1 2025
+ Interest expenseQ4 2024
+ Interest expenseQ3 2024)
= (1,257 + 1,210 + 1,208 + 1,233)
÷ (71 + 33 + 42 + 29)
= 28.05
2 Click competitor name to see calculations.
- Earnings before interest and tax (EBIT)
- The EBIT values demonstrate a fluctuating but generally upward trend over the periods analyzed. Starting from 576 million USD at the end of Q1 2021, the EBIT increased significantly to a peak of 1150 million USD in Q3 2021. Thereafter, it experienced some volatility with values hovering between 650 and 900 million USD through 2021 and early 2022. From mid-2022 onward, EBIT showed a strong and consistent growth trajectory, reaching a new high of 1233 million USD in Q3 2024 before slightly stabilizing around 1200-1250 million USD at the end of 2024 and into mid-2025. This pattern indicates enhanced operational profitability in recent quarters compared to the earlier periods.
- Interest expense, net
- Interest expense remained relatively stable and low in the first half of the timeline, generally oscillating between 30 and 44 million USD. Notable fluctuations were observed beginning in early 2023, with interest expenses decreasing to 26 million USD in Q4 2023 then slightly increasing again towards mid-2025. The highest recorded expense was 71 million USD in Q2 2025, marking a significant spike. Overall, the interest expenses showed some instability in the later periods, suggesting changes in borrowing costs or debt structure.
- Interest coverage ratio
- The interest coverage ratio exhibited a marked improvement throughout the periods. Starting at 11.87 at the beginning of 2021, the ratio rose sharply and demonstrated consistent growth, peaking at 40.37 in Q3 2024. This trend reflects enhanced ability to cover interest expenses through EBIT, driven by increasing earnings and relatively contained interest costs during most of the timeline. Despite some decline in the last two periods (to 28.05 in mid-2025), the interest coverage ratio remains substantially higher than early periods, indicating strong financial health with respect to debt servicing capacity.