Analysis of Solvency Ratios
Solvency ratios also known as long-term debt ratios measure a company ability to meet long-term obligations.
Solvency Ratios (Summary)
Alphabet Inc., solvency ratios
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The solvency position, as indicated by the presented metrics, demonstrates a generally stable profile with a notable shift in the most recent year. Throughout the period from 2021 to 2023, the company maintained consistent leverage ratios. However, 2024 and 2025 show indications of increasing financial risk, particularly when considering operating lease liabilities. Coverage ratios, while consistently high, also exhibit fluctuations.
- Debt Ratios
- Debt to equity, debt to capital, and debt to assets remained largely unchanged between 2021 and 2023, suggesting a consistent capital structure. A moderate increase is observed in all three ratios in 2025. When including operating lease liabilities, the ratios are higher overall and demonstrate a more pronounced increase in 2025, indicating a growing reliance on lease financing. Specifically, debt to equity (including operating lease liability) rose from 0.11 in 2021 to 0.16 in 2025. The debt to assets ratio, including operating lease liability, increased from 0.08 to 0.11 over the same period.
- Leverage Ratio
- Financial leverage remained relatively stable between 1.42 and 1.43 for most of the period, with a slight dip to 1.39 in 2024. This suggests a consistent proportion of assets financed by debt. The return to 1.43 in 2025 indicates a reversal of this slight decrease.
- Coverage Ratios
- Interest coverage experienced a decline from 263.24 in 2021 to 200.80 in 2022, followed by a substantial increase to 448.07 in 2024. However, it decreased again to 216.80 in 2025. This volatility suggests fluctuations in earnings relative to interest expense. Fixed charge coverage mirrored this trend, increasing from 22.90 in 2022 to 39.92 in 2025, with an interim peak of 34.54 in 2024. Despite the fluctuations, both coverage ratios remained at healthy levels throughout the period, indicating a strong ability to meet fixed financial obligations.
In summary, the company’s solvency appears generally strong, but the increases in debt ratios in 2025, particularly when including operating lease liabilities, warrant further investigation. While coverage ratios remain robust, the observed volatility suggests potential sensitivity to changes in earnings or interest rates.
Debt Ratios
Coverage Ratios
Debt to Equity
Alphabet Inc., debt to equity calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current finance lease liabilities | 441) | 235) | —) | —) | —) | |
| Short-term debt | 1,996) | 3,299) | 1,363) | 298) | 113) | |
| Long-term debt, excluding current portion | 46,547) | 10,883) | 13,253) | 14,701) | 14,817) | |
| Long-term finance lease liabilities | 2,059) | 1,442) | —) | —) | —) | |
| Total debt | 51,043) | 15,859) | 14,616) | 14,999) | 14,930) | |
| Stockholders’ equity | 415,265) | 325,084) | 283,379) | 256,144) | 251,635) | |
| Solvency Ratio | ||||||
| Debt to equity1 | 0.12 | 0.05 | 0.05 | 0.06 | 0.06 | |
| Benchmarks | ||||||
| Debt to Equity, Competitors2 | ||||||
| Comcast Corp. | 1.02 | 1.16 | 1.17 | 1.17 | 0.99 | |
| Meta Platforms Inc. | 0.28 | 0.16 | 0.12 | 0.08 | 0.00 | |
| Netflix Inc. | 0.54 | 0.63 | 0.71 | 0.69 | 0.97 | |
| Trade Desk Inc. | — | 0.00 | 0.00 | 0.00 | 0.00 | |
| Walt Disney Co. | 0.38 | 0.46 | 0.47 | 0.51 | 0.62 | |
| Debt to Equity, Sector | ||||||
| Media & Entertainment | — | 0.29 | 0.30 | 0.32 | 0.31 | |
| Debt to Equity, Industry | ||||||
| Communication Services | — | 0.56 | 0.62 | 0.65 | 0.65 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Debt to equity = Total debt ÷ Stockholders’ equity
= 51,043 ÷ 415,265 = 0.12
2 Click competitor name to see calculations.
The debt-to-equity ratio demonstrates a period of stability followed by a notable increase. From 2021 through 2023, the ratio exhibited a slight downward trend, indicating a decreasing reliance on debt financing relative to equity. However, this trend reversed in 2024 and continued into 2025, with a significant increase in the ratio.
- Debt-to-Equity Ratio Trend
- The debt-to-equity ratio remained consistent at 0.06 for both 2021 and 2022. A modest decrease was observed in 2023, with the ratio falling to 0.05. This level was maintained in 2024. A substantial increase is then apparent in 2025, with the ratio rising to 0.12.
The relatively low and stable ratio from 2021 to 2024 suggests a conservative capital structure and a strong equity base. The considerable jump in the ratio in 2025 indicates a significant increase in debt levels relative to equity, potentially signaling increased financial leverage or a shift in financing strategy. Further investigation would be required to understand the reasons behind this increase, such as new debt issuance for acquisitions, share repurchases, or operational investments.
- Total Debt
- Total debt remained relatively stable between 2021 and 2023, fluctuating between US$14.6 billion and US$15.0 billion. A substantial increase to US$51.0 billion is observed in 2025, directly contributing to the rise in the debt-to-equity ratio.
- Stockholders’ Equity
- Stockholders’ equity consistently increased throughout the period, rising from US$251.6 billion in 2021 to US$415.3 billion in 2025. While equity growth is positive, it was not sufficient to offset the substantial increase in debt during the final year of the observed period.
The combination of increasing debt and growing equity in 2025 resulted in a higher debt-to-equity ratio, suggesting a potentially increased level of financial risk. Monitoring this ratio in subsequent periods will be crucial to assess the long-term implications of this change in capital structure.
Debt to Equity (including Operating Lease Liability)
Alphabet Inc., debt to equity (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current finance lease liabilities | 441) | 235) | —) | —) | —) | |
| Short-term debt | 1,996) | 3,299) | 1,363) | 298) | 113) | |
| Long-term debt, excluding current portion | 46,547) | 10,883) | 13,253) | 14,701) | 14,817) | |
| Long-term finance lease liabilities | 2,059) | 1,442) | —) | —) | —) | |
| Total debt | 51,043) | 15,859) | 14,616) | 14,999) | 14,930) | |
| Current operating lease liabilities (included in Accrued expenses and other liabilities) | 3,209) | 2,887) | 2,791) | 2,477) | 2,189) | |
| Long-term operating lease liabilities | 12,744) | 11,691) | 12,460) | 12,501) | 11,389) | |
| Total debt (including operating lease liability) | 66,996) | 30,437) | 29,867) | 29,977) | 28,508) | |
| Stockholders’ equity | 415,265) | 325,084) | 283,379) | 256,144) | 251,635) | |
| Solvency Ratio | ||||||
| Debt to equity (including operating lease liability)1 | 0.16 | 0.09 | 0.11 | 0.12 | 0.11 | |
| Benchmarks | ||||||
| Debt to Equity (including Operating Lease Liability), Competitors2 | ||||||
| Comcast Corp. | 1.08 | 1.23 | 1.25 | 1.26 | 1.06 | |
| Meta Platforms Inc. | 0.39 | 0.27 | 0.25 | 0.22 | 0.12 | |
| Netflix Inc. | 0.64 | 0.73 | 0.82 | 0.81 | 1.14 | |
| Trade Desk Inc. | — | 0.11 | 0.11 | 0.12 | 0.19 | |
| Walt Disney Co. | 0.41 | 0.49 | 0.51 | 0.55 | 0.66 | |
| Debt to Equity (including Operating Lease Liability), Sector | ||||||
| Media & Entertainment | — | 0.35 | 0.37 | 0.39 | 0.38 | |
| Debt to Equity (including Operating Lease Liability), Industry | ||||||
| Communication Services | — | 0.69 | 0.76 | 0.80 | 0.79 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Debt to equity (including operating lease liability) = Total debt (including operating lease liability) ÷ Stockholders’ equity
= 66,996 ÷ 415,265 = 0.16
2 Click competitor name to see calculations.
The debt to equity ratio, incorporating operating lease liabilities, exhibited a generally stable pattern from 2021 through 2023, followed by a notable increase in 2024 and a significant jump in 2025. Total debt, inclusive of operating lease liabilities, demonstrated a modest increase between 2021 and 2022, followed by a slight decrease in 2023, a further modest increase in 2024, and a substantial rise in 2025. Simultaneously, stockholders’ equity consistently increased throughout the observed period.
- Debt to Equity Ratio – Overall Trend
- The debt to equity ratio remained relatively low and stable between 0.11 and 0.12 from 2021 to 2023. A decrease to 0.09 was observed in 2024, indicating a strengthening of the equity position relative to debt. However, the ratio increased substantially to 0.16 in 2025, suggesting a greater reliance on debt financing or a decrease in equity relative to debt.
- Total Debt (including operating lease liability)
- Total debt remained relatively consistent between 2021 and 2024, fluctuating within a narrow range of approximately $28.5 billion to $30.4 billion. The significant increase to $66.996 billion in 2025 represents a substantial change in the company’s debt structure.
- Stockholders’ Equity
- Stockholders’ equity demonstrated a consistent upward trend throughout the period, increasing from $251.635 billion in 2021 to $415.265 billion in 2025. This consistent growth in equity partially offset the impact of the increased debt in later years, but was insufficient to prevent the rise in the debt to equity ratio in 2025.
The substantial increase in the debt to equity ratio in 2025 warrants further investigation to understand the underlying reasons for the significant rise in total debt and its potential implications for the company’s financial risk profile.
Debt to Capital
Alphabet Inc., debt to capital calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current finance lease liabilities | 441) | 235) | —) | —) | —) | |
| Short-term debt | 1,996) | 3,299) | 1,363) | 298) | 113) | |
| Long-term debt, excluding current portion | 46,547) | 10,883) | 13,253) | 14,701) | 14,817) | |
| Long-term finance lease liabilities | 2,059) | 1,442) | —) | —) | —) | |
| Total debt | 51,043) | 15,859) | 14,616) | 14,999) | 14,930) | |
| Stockholders’ equity | 415,265) | 325,084) | 283,379) | 256,144) | 251,635) | |
| Total capital | 466,308) | 340,943) | 297,995) | 271,143) | 266,565) | |
| Solvency Ratio | ||||||
| Debt to capital1 | 0.11 | 0.05 | 0.05 | 0.06 | 0.06 | |
| Benchmarks | ||||||
| Debt to Capital, Competitors2 | ||||||
| Comcast Corp. | 0.51 | 0.54 | 0.54 | 0.54 | 0.50 | |
| Meta Platforms Inc. | 0.22 | 0.14 | 0.11 | 0.08 | 0.00 | |
| Netflix Inc. | 0.35 | 0.39 | 0.41 | 0.41 | 0.49 | |
| Trade Desk Inc. | — | 0.00 | 0.00 | 0.00 | 0.00 | |
| Walt Disney Co. | 0.28 | 0.31 | 0.32 | 0.34 | 0.38 | |
| Debt to Capital, Sector | ||||||
| Media & Entertainment | — | 0.22 | 0.23 | 0.24 | 0.24 | |
| Debt to Capital, Industry | ||||||
| Communication Services | — | 0.36 | 0.38 | 0.39 | 0.40 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Debt to capital = Total debt ÷ Total capital
= 51,043 ÷ 466,308 = 0.11
2 Click competitor name to see calculations.
The debt to capital ratio demonstrates a generally stable financial position for the period examined, with a notable increase in the most recent year. Throughout 2021, 2022, 2023, and 2024, the ratio remained relatively consistent, before experiencing a significant shift in 2025.
- Debt to Capital Ratio - Trend Analysis
- From 2021 to 2024, the debt to capital ratio held steady at approximately 0.06, then decreased slightly to 0.05. This indicates a consistent reliance on capital relative to debt financing during this period. However, in 2025, the ratio increased substantially to 0.11. This represents a significant change, suggesting a greater proportion of debt financing compared to capital.
- Debt to Capital Ratio - Magnitude
- The ratio remained below 0.10 for the majority of the observed period. Values below this threshold generally suggest a conservative capital structure and a lower level of financial risk. The increase to 0.11 in 2025, while still not excessively high, warrants further investigation to understand the drivers behind the increased debt reliance.
- Underlying Components
- Total debt remained relatively stable between 2021 and 2024, fluctuating within a narrow range. However, a substantial increase in total debt is observed in 2025, contributing directly to the rise in the debt to capital ratio. Simultaneously, total capital also increased, but not at a rate sufficient to offset the increase in debt.
The observed trend suggests a potential shift in financing strategy or a need for increased capital investment in 2025. Further analysis is recommended to determine the reasons for the substantial increase in debt and its potential implications for the company’s long-term financial health.
Debt to Capital (including Operating Lease Liability)
Alphabet Inc., debt to capital (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current finance lease liabilities | 441) | 235) | —) | —) | —) | |
| Short-term debt | 1,996) | 3,299) | 1,363) | 298) | 113) | |
| Long-term debt, excluding current portion | 46,547) | 10,883) | 13,253) | 14,701) | 14,817) | |
| Long-term finance lease liabilities | 2,059) | 1,442) | —) | —) | —) | |
| Total debt | 51,043) | 15,859) | 14,616) | 14,999) | 14,930) | |
| Current operating lease liabilities (included in Accrued expenses and other liabilities) | 3,209) | 2,887) | 2,791) | 2,477) | 2,189) | |
| Long-term operating lease liabilities | 12,744) | 11,691) | 12,460) | 12,501) | 11,389) | |
| Total debt (including operating lease liability) | 66,996) | 30,437) | 29,867) | 29,977) | 28,508) | |
| Stockholders’ equity | 415,265) | 325,084) | 283,379) | 256,144) | 251,635) | |
| Total capital (including operating lease liability) | 482,261) | 355,521) | 313,246) | 286,121) | 280,143) | |
| Solvency Ratio | ||||||
| Debt to capital (including operating lease liability)1 | 0.14 | 0.09 | 0.10 | 0.10 | 0.10 | |
| Benchmarks | ||||||
| Debt to Capital (including Operating Lease Liability), Competitors2 | ||||||
| Comcast Corp. | 0.52 | 0.55 | 0.56 | 0.56 | 0.52 | |
| Meta Platforms Inc. | 0.28 | 0.21 | 0.20 | 0.18 | 0.10 | |
| Netflix Inc. | 0.39 | 0.42 | 0.45 | 0.45 | 0.53 | |
| Trade Desk Inc. | — | 0.10 | 0.10 | 0.11 | 0.16 | |
| Walt Disney Co. | 0.29 | 0.33 | 0.34 | 0.35 | 0.40 | |
| Debt to Capital (including Operating Lease Liability), Sector | ||||||
| Media & Entertainment | — | 0.26 | 0.27 | 0.28 | 0.28 | |
| Debt to Capital (including Operating Lease Liability), Industry | ||||||
| Communication Services | — | 0.41 | 0.43 | 0.44 | 0.44 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Debt to capital (including operating lease liability) = Total debt (including operating lease liability) ÷ Total capital (including operating lease liability)
= 66,996 ÷ 482,261 = 0.14
2 Click competitor name to see calculations.
The Debt to Capital ratio, inclusive of operating lease liabilities, exhibited a period of stability followed by a notable increase over the observed five-year period. Initially, the ratio remained consistent at 0.10 for both 2021 and 2022. A slight decrease to 0.09 was recorded in 2023, before increasing to 0.14 in 2025.
- Total Debt (including operating lease liability)
- Total debt demonstrated a modest increase from US$28,508 million in 2021 to US$29,977 million in 2022. It then experienced a slight decline to US$29,867 million in 2023, followed by a further increase to US$30,437 million in 2024. A substantial rise to US$66,996 million was observed in 2025, representing the most significant change in the period.
- Total Capital (including operating lease liability)
- Total capital generally increased throughout the period. From US$280,143 million in 2021, it rose to US$286,121 million in 2022 and continued to US$313,246 million in 2023. The growth continued to US$355,521 million in 2024, culminating in US$482,261 million in 2025. The increase in capital appears to have been more substantial in the later years of the period.
- Debt to Capital Ratio Trend
- The initial stability in the Debt to Capital ratio suggests a consistent capital structure during 2021 and 2022. The slight decrease in 2023 indicates a marginally improved solvency position. However, the increase to 0.14 in 2025, driven primarily by the significant rise in total debt, suggests a higher degree of financial leverage. This shift warrants further investigation to understand the underlying reasons for the increased debt levels and their potential impact on the company’s financial risk profile.
The substantial increase in both total debt and total capital in 2025 is a key observation. While capital increased, the proportionally larger increase in debt resulted in a higher Debt to Capital ratio, indicating a greater reliance on debt financing.
Debt to Assets
Alphabet Inc., debt to assets calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current finance lease liabilities | 441) | 235) | —) | —) | —) | |
| Short-term debt | 1,996) | 3,299) | 1,363) | 298) | 113) | |
| Long-term debt, excluding current portion | 46,547) | 10,883) | 13,253) | 14,701) | 14,817) | |
| Long-term finance lease liabilities | 2,059) | 1,442) | —) | —) | —) | |
| Total debt | 51,043) | 15,859) | 14,616) | 14,999) | 14,930) | |
| Total assets | 595,281) | 450,256) | 402,392) | 365,264) | 359,268) | |
| Solvency Ratio | ||||||
| Debt to assets1 | 0.09 | 0.04 | 0.04 | 0.04 | 0.04 | |
| Benchmarks | ||||||
| Debt to Assets, Competitors2 | ||||||
| Comcast Corp. | 0.36 | 0.37 | 0.37 | 0.37 | 0.34 | |
| Meta Platforms Inc. | 0.16 | 0.11 | 0.08 | 0.06 | 0.00 | |
| Netflix Inc. | 0.26 | 0.29 | 0.30 | 0.30 | 0.35 | |
| Trade Desk Inc. | — | 0.00 | 0.00 | 0.00 | 0.00 | |
| Walt Disney Co. | 0.21 | 0.23 | 0.23 | 0.24 | 0.27 | |
| Debt to Assets, Sector | ||||||
| Media & Entertainment | — | 0.17 | 0.17 | 0.17 | 0.17 | |
| Debt to Assets, Industry | ||||||
| Communication Services | — | 0.25 | 0.26 | 0.26 | 0.27 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Debt to assets = Total debt ÷ Total assets
= 51,043 ÷ 595,281 = 0.09
2 Click competitor name to see calculations.
The debt-to-assets ratio remained consistent for the first four years of the observed period before experiencing a significant increase in the final year. This indicates a notable shift in the company’s capital structure.
- Debt to Assets Ratio - Trend Analysis
- From December 31, 2021, through December 31, 2024, the debt-to-assets ratio held steady at 0.04. This suggests a stable reliance on debt financing relative to the company’s asset base during this timeframe. However, a substantial increase to 0.09 is observed as of December 31, 2025. This represents a considerable rise in the proportion of assets financed by debt.
The consistent ratio from 2021 to 2024 implies a deliberate and maintained financial leverage strategy. The sharp increase in 2025 warrants further investigation to understand the reasons behind the increased debt levels, such as potential acquisitions, significant capital investments, or changes in financing policies. The increase in total debt was proportionally larger than the increase in total assets, driving the ratio higher.
- Debt to Assets Ratio - Magnitude
- Prior to 2025, a ratio of 0.04 suggests a conservative capital structure with a relatively low level of debt compared to assets. The jump to 0.09 in 2025, while still not exceptionally high, indicates a more leveraged position. The company’s ability to service this increased debt will be a key factor to monitor.
The observed trend suggests a potential change in the company’s financial strategy in 2025. Continued monitoring of this ratio, alongside other solvency and liquidity metrics, is recommended to assess the long-term implications of this shift.
Debt to Assets (including Operating Lease Liability)
Alphabet Inc., debt to assets (including operating lease liability) calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Current finance lease liabilities | 441) | 235) | —) | —) | —) | |
| Short-term debt | 1,996) | 3,299) | 1,363) | 298) | 113) | |
| Long-term debt, excluding current portion | 46,547) | 10,883) | 13,253) | 14,701) | 14,817) | |
| Long-term finance lease liabilities | 2,059) | 1,442) | —) | —) | —) | |
| Total debt | 51,043) | 15,859) | 14,616) | 14,999) | 14,930) | |
| Current operating lease liabilities (included in Accrued expenses and other liabilities) | 3,209) | 2,887) | 2,791) | 2,477) | 2,189) | |
| Long-term operating lease liabilities | 12,744) | 11,691) | 12,460) | 12,501) | 11,389) | |
| Total debt (including operating lease liability) | 66,996) | 30,437) | 29,867) | 29,977) | 28,508) | |
| Total assets | 595,281) | 450,256) | 402,392) | 365,264) | 359,268) | |
| Solvency Ratio | ||||||
| Debt to assets (including operating lease liability)1 | 0.11 | 0.07 | 0.07 | 0.08 | 0.08 | |
| Benchmarks | ||||||
| Debt to Assets (including Operating Lease Liability), Competitors2 | ||||||
| Comcast Corp. | 0.39 | 0.40 | 0.39 | 0.39 | 0.37 | |
| Meta Platforms Inc. | 0.23 | 0.18 | 0.17 | 0.15 | 0.09 | |
| Netflix Inc. | 0.31 | 0.34 | 0.35 | 0.35 | 0.41 | |
| Trade Desk Inc. | — | 0.05 | 0.05 | 0.06 | 0.08 | |
| Walt Disney Co. | 0.23 | 0.25 | 0.25 | 0.26 | 0.29 | |
| Debt to Assets (including Operating Lease Liability), Sector | ||||||
| Media & Entertainment | — | 0.20 | 0.21 | 0.21 | 0.21 | |
| Debt to Assets (including Operating Lease Liability), Industry | ||||||
| Communication Services | — | 0.30 | 0.32 | 0.33 | 0.33 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Debt to assets (including operating lease liability) = Total debt (including operating lease liability) ÷ Total assets
= 66,996 ÷ 595,281 = 0.11
2 Click competitor name to see calculations.
The Debt to Assets ratio, including operating lease liability, demonstrates a generally stable profile from 2021 through 2023, followed by a notable increase in 2024 and a significant jump in 2025. This indicates a shifting capital structure over the observed period.
- Debt to Assets Ratio (Including Operating Lease Liability)
- The ratio remained consistent at 0.08 for both 2021 and 2022, suggesting a stable level of debt financing relative to the company’s asset base during those years. A slight decrease to 0.07 was observed in 2023, continuing into 2024, indicating a marginal improvement in the company’s solvency position. However, the ratio increased substantially to 0.11 in 2025. This represents a significant rise in leverage, suggesting a greater reliance on debt to finance assets.
Total debt, including operating lease liability, exhibited modest fluctuations between 2021 and 2024, remaining within a relatively narrow range. The substantial increase in 2025, from US$30,437 million to US$66,996 million, is the primary driver of the increased Debt to Assets ratio. Simultaneously, Total assets increased from US$450,256 million in 2024 to US$595,281 million in 2025, but not at a rate sufficient to offset the increase in total debt.
The observed trend suggests a strategic shift in financing activities in 2025. Further investigation would be required to determine the reasons for the substantial increase in debt, such as acquisitions, significant capital expenditures, or changes in financing strategy. The increase in the ratio warrants monitoring to assess potential impacts on financial risk and future performance.
Financial Leverage
Alphabet Inc., financial leverage calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Total assets | 595,281) | 450,256) | 402,392) | 365,264) | 359,268) | |
| Stockholders’ equity | 415,265) | 325,084) | 283,379) | 256,144) | 251,635) | |
| Solvency Ratio | ||||||
| Financial leverage1 | 1.43 | 1.39 | 1.42 | 1.43 | 1.43 | |
| Benchmarks | ||||||
| Financial Leverage, Competitors2 | ||||||
| Comcast Corp. | 2.81 | 3.11 | 3.20 | 3.18 | 2.87 | |
| Meta Platforms Inc. | 1.68 | 1.51 | 1.50 | 1.48 | 1.33 | |
| Netflix Inc. | 2.09 | 2.17 | 2.37 | 2.34 | 2.81 | |
| Trade Desk Inc. | — | 2.07 | 2.26 | 2.07 | 2.34 | |
| Walt Disney Co. | 1.80 | 1.95 | 2.07 | 2.14 | 2.30 | |
| Financial Leverage, Sector | ||||||
| Media & Entertainment | — | 1.73 | 1.80 | 1.83 | 1.82 | |
| Financial Leverage, Industry | ||||||
| Communication Services | — | 2.27 | 2.39 | 2.45 | 2.43 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Financial leverage = Total assets ÷ Stockholders’ equity
= 595,281 ÷ 415,265 = 1.43
2 Click competitor name to see calculations.
An examination of the provided financial information reveals a generally stable financial leverage position over the five-year period. Total assets exhibited consistent growth, increasing from US$359,268 million in 2021 to US$595,281 million in 2025. Stockholders’ equity also demonstrated a positive trajectory, rising from US$251,635 million in 2021 to US$415,265 million in 2025.
- Financial Leverage
- The financial leverage ratio remained relatively consistent, fluctuating between 1.39 and 1.43 throughout the period. It began at 1.43 in 2021 and 2022, decreased slightly to 1.42 in 2023, then further to 1.39 in 2024, before returning to 1.43 in 2025. This indicates a stable reliance on debt financing relative to equity. The slight decrease in 2023 and 2024 suggests a minor reduction in the proportion of assets financed by debt, but this trend was reversed in 2025.
The concurrent growth in both total assets and stockholders’ equity suggests that the company has been effectively financing its asset expansion through a combination of debt and equity. The stability of the financial leverage ratio implies a consistent approach to capital structure management. The modest fluctuations within the ratio do not appear to indicate significant shifts in risk profile during the observed timeframe.
Overall, the information suggests a financially sound position with a controlled level of financial risk, as indicated by the consistent financial leverage ratio.
Interest Coverage
Alphabet Inc., interest coverage calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income | 132,170) | 100,118) | 73,795) | 59,972) | 76,033) | |
| Add: Income tax expense | 26,656) | 19,697) | 11,922) | 11,356) | 14,701) | |
| Add: Interest expense | 736) | 268) | 308) | 357) | 346) | |
| Earnings before interest and tax (EBIT) | 159,562) | 120,083) | 86,025) | 71,685) | 91,080) | |
| Solvency Ratio | ||||||
| Interest coverage1 | 216.80 | 448.07 | 279.30 | 200.80 | 263.24 | |
| Benchmarks | ||||||
| Interest Coverage, Competitors2 | ||||||
| Comcast Corp. | 6.84 | 5.52 | 6.01 | 3.38 | 5.46 | |
| Meta Platforms Inc. | 74.76 | 99.83 | 107.34 | 164.74 | 3,153.27 | |
| Netflix Inc. | 17.38 | 14.87 | 9.87 | 8.45 | 8.63 | |
| Trade Desk Inc. | — | 336.07 | 162.83 | 32.73 | 119.48 | |
| Walt Disney Co. | 7.62 | 4.66 | 3.42 | 4.41 | 2.66 | |
| Interest Coverage, Sector | ||||||
| Media & Entertainment | — | 29.73 | 22.94 | 18.96 | 24.82 | |
| Interest Coverage, Industry | ||||||
| Communication Services | — | 12.39 | 10.22 | 8.51 | 11.90 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Interest coverage = EBIT ÷ Interest expense
= 159,562 ÷ 736 = 216.80
2 Click competitor name to see calculations.
The interest coverage ratio demonstrates significant fluctuation over the five-year period. Earnings before interest and tax (EBIT) and interest expense both contribute to these observed changes. Generally, the company maintains a strong ability to meet its interest obligations, but recent trends warrant attention.
- Overall Trend
- The interest coverage ratio experienced a substantial decrease from 2021 to 2022, followed by recovery in 2023 and a dramatic increase in 2024. However, the ratio declined again in 2025, though remaining positive.
- EBIT Influence
- EBIT decreased from US$91,080 million in 2021 to US$71,685 million in 2022, contributing to the initial decline in the interest coverage ratio. A subsequent increase to US$86,025 million in 2023 partially offset this effect. The most significant increase in EBIT occurred between 2023 and 2024, reaching US$120,083 million, which drove the substantial improvement in the interest coverage ratio during that period. A further increase to US$159,562 million in 2025 was not enough to offset the impact of rising interest expense.
- Interest Expense Influence
- Interest expense remained relatively stable between 2021 and 2023, fluctuating between US$346 million and US$357 million. A notable increase to US$736 million in 2025 significantly reduced the interest coverage ratio, despite the concurrent increase in EBIT. This suggests a growing burden from interest-bearing liabilities.
- Ratio Values
- The interest coverage ratio was highest in 2021 at 263.24, indicating a very strong capacity to cover interest payments. The ratio fell to 200.80 in 2022, still representing a comfortable margin. It recovered to 279.30 in 2023 and peaked at 448.07 in 2024. The ratio decreased to 216.80 in 2025, indicating a reduced, but still adequate, ability to cover interest obligations.
The increase in interest expense in 2025, coupled with the decline in the interest coverage ratio, suggests a potential area for further investigation. Monitoring both EBIT and interest expense will be crucial in assessing the company’s future solvency.
Fixed Charge Coverage
Alphabet Inc., fixed charge coverage calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income | 132,170) | 100,118) | 73,795) | 59,972) | 76,033) | |
| Add: Income tax expense | 26,656) | 19,697) | 11,922) | 11,356) | 14,701) | |
| Add: Interest expense | 736) | 268) | 308) | 357) | 346) | |
| Earnings before interest and tax (EBIT) | 159,562) | 120,083) | 86,025) | 71,685) | 91,080) | |
| Add: Operating lease cost | 3,345) | 3,304) | 3,362) | 2,900) | 2,699) | |
| Earnings before fixed charges and tax | 162,907) | 123,387) | 89,387) | 74,585) | 93,779) | |
| Interest expense | 736) | 268) | 308) | 357) | 346) | |
| Operating lease cost | 3,345) | 3,304) | 3,362) | 2,900) | 2,699) | |
| Fixed charges | 4,081) | 3,572) | 3,670) | 3,257) | 3,045) | |
| Solvency Ratio | ||||||
| Fixed charge coverage1 | 39.92 | 34.54 | 24.36 | 22.90 | 30.80 | |
| Benchmarks | ||||||
| Fixed Charge Coverage, Competitors2 | ||||||
| Comcast Corp. | 5.59 | 4.50 | 4.87 | 2.82 | 4.48 | |
| Meta Platforms Inc. | 22.68 | 23.99 | 19.69 | 15.18 | 31.41 | |
| Netflix Inc. | 9.55 | 8.20 | 5.64 | 5.00 | 5.46 | |
| Trade Desk Inc. | — | 9.70 | 6.30 | 3.28 | 3.35 | |
| Walt Disney Co. | 5.64 | 3.53 | 2.71 | 3.25 | 2.07 | |
| Fixed Charge Coverage, Sector | ||||||
| Media & Entertainment | — | 14.84 | 11.52 | 9.52 | 12.97 | |
| Fixed Charge Coverage, Industry | ||||||
| Communication Services | — | 6.66 | 5.47 | 4.31 | 6.03 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 2025 Calculation
Fixed charge coverage = Earnings before fixed charges and tax ÷ Fixed charges
= 162,907 ÷ 4,081 = 39.92
2 Click competitor name to see calculations.
The company demonstrates a generally positive trend in its ability to cover fixed charges over the five-year period. Earnings before fixed charges and tax experienced fluctuations, while fixed charges exhibited a consistent, albeit moderate, increase. Consequently, the fixed charge coverage ratio showed volatility initially, followed by substantial improvement in later years.
- Earnings Before Fixed Charges and Tax
- Earnings before fixed charges and tax decreased from US$93,779 million in 2021 to US$74,585 million in 2022, representing a significant decline. A recovery was observed in 2023, with earnings reaching US$89,387 million. Further growth occurred in 2024 and 2025, with earnings increasing to US$123,387 million and US$162,907 million, respectively. This indicates a strengthening of operational profitability in the latter part of the period.
- Fixed Charges
- Fixed charges increased steadily throughout the period, from US$3,045 million in 2021 to US$4,081 million in 2025. The increases were relatively consistent year-over-year, suggesting a stable financial structure regarding obligations like lease payments and debt service.
- Fixed Charge Coverage
- The fixed charge coverage ratio decreased from 30.80 in 2021 to 22.90 in 2022, mirroring the decline in earnings before fixed charges and tax. The ratio improved to 24.36 in 2023, coinciding with the earnings recovery. A substantial increase was then observed in 2024, with the ratio reaching 34.54, and continued to rise to 39.92 in 2025. This demonstrates a strengthening capacity to meet fixed financial obligations as earnings grew, despite the increasing absolute value of those obligations.
Overall, while the company experienced a temporary dip in its ability to cover fixed charges in 2022, it demonstrated a strong recovery and improvement in subsequent years. The increasing fixed charge coverage ratio suggests a decreasing level of financial risk related to fixed obligations.