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)
Visa Inc., solvency ratios (quarterly data)
Based on: 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-K (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-K (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-K (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-K (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-K (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-K (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31).
- Debt to Equity Ratio
- The debt to equity ratio shows a relatively stable pattern from December 2016 to December 2019, fluctuating slightly between 0.47 and 0.56. Beginning in early 2020, there is a noticeable increase, peaking at 0.66 in June 2020, likely indicative of a higher reliance on debt during that period. After this peak, the ratio gradually declines but remains elevated compared to the pre-2020 level, ending at 0.53 in March 2023. This trend suggests a moderate increase in financial leverage over the long term, with some retrenchment in the most recent quarters.
- Debt to Capital Ratio
- This ratio remained fairly consistent around the low to mid 0.30s from 2016 through early 2020. There was a moderate increase beginning in March 2020 reaching a high of 0.40 in June 2020 and again in September 2022, suggesting periodic increments in the proportion of debt relative to total capital. The ratio slightly declines towards the end of the period, finishing at 0.35 in March 2023, reflecting a somewhat cautious approach to capital structure following peaks during the earlier years of the pandemic and subsequent market adjustments.
- Debt to Assets Ratio
- The debt to assets ratio displays a consistent trend near 0.24 from 2016 until early 2020. An upward movement is seen in 2020, peaking at 0.30 in June 2020, which aligns with the heightened debt levels previously observed. Following this, the ratio decreases and stabilizes around the mid-0.20s, demonstrating a rebalancing of asset and debt levels. The ratio ends at 0.24 in March 2023, indicating a return towards normalized asset leverage.
- Financial Leverage Ratio
- The financial leverage ratio shows a generally increasing trajectory throughout the period analyzed, starting at 2.00 in December 2016 and gradually climbing with minor fluctuations to a high of 2.41 in September 2022. This trend reflects an increasing use of debt in financing the company’s assets, with a slight decline thereafter to 2.25 by March 2023. The rise suggests an augmented amplification of equity by assets, consistent with the observations in debt ratios.
- Interest Coverage Ratio
- The interest coverage ratio data begins in June 2017 with a strong position above 21 and steadily improves throughout the years. It reaches a peak of 35.85 in December 2022 and remains robust above 34 through the first quarter of 2023. This increasing trend indicates enhanced ability to meet interest obligations from operating earnings, signalling strong operational performance and low risk from interest burden despite fluctuations in debt levels.
- Overall Analysis
- Over the examined period, the financial risk indicated by debt-related ratios exhibits moderate increases particularly during the 2020 period, likely influenced by external factors impacting financial strategies. The subsequent gradual correction and stabilization of these ratios suggest a return to more conservative leverage levels. Concurrently, the strong and improving interest coverage ratio indicates substantial earnings strength supporting the company's debt service capacity, reinforcing financial stability despite elevated leverage metrics during peak periods.
Debt Ratios
Coverage Ratios
Debt to Equity
Visa Inc., debt to equity calculation (quarterly data)
| 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 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||||||
| Current maturities of debt | —) | —) | 2,250) | 3,249) | 3,548) | 3,247) | 999) | —) | —) | —) | 2,999) | 2,999) | 3,999) | 3,000) | —) | —) | —) | —) | —) | —) | —) | —) | 1,749) | 1,749) | 1,748) | 2,313) | ||||||||
| Long-term debt, excluding current maturities | 20,606) | 20,487) | 20,200) | 20,546) | 17,479) | 17,673) | 19,978) | 20,996) | 20,974) | 21,055) | 21,071) | 17,880) | 13,893) | 13,688) | 16,729) | 16,694) | 16,630) | 16,633) | 16,630) | 16,627) | 16,624) | 16,621) | 16,618) | 14,142) | 14,140) | 14,138) | ||||||||
| Total debt | 20,606) | 20,487) | 22,450) | 23,795) | 21,027) | 20,920) | 20,977) | 20,996) | 20,974) | 21,055) | 24,070) | 20,879) | 17,892) | 16,688) | 16,729) | 16,694) | 16,630) | 16,633) | 16,630) | 16,627) | 16,624) | 16,621) | 18,367) | 15,891) | 15,888) | 16,451) | ||||||||
| Equity | 38,565) | 36,924) | 35,581) | 35,483) | 35,989) | 36,194) | 37,589) | 37,790) | 37,696) | 37,679) | 36,210) | 35,524) | 34,585) | 35,270) | 34,684) | 34,995) | 34,275) | 34,095) | 34,006) | 33,318) | 34,103) | 33,401) | 32,760) | 31,944) | 30,783) | 31,726) | ||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||||||
| Debt to equity1 | 0.53 | 0.55 | 0.63 | 0.67 | 0.58 | 0.58 | 0.56 | 0.56 | 0.56 | 0.56 | 0.66 | 0.59 | 0.52 | 0.47 | 0.48 | 0.48 | 0.49 | 0.49 | 0.49 | 0.50 | 0.49 | 0.50 | 0.56 | 0.50 | 0.52 | 0.52 | ||||||||
| Benchmarks | ||||||||||||||||||||||||||||||||||
| Debt to Equity, Competitors2 | ||||||||||||||||||||||||||||||||||
| Accenture PLC | 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 | — | — | — | — | — | — | — | — | ||||||||
| Adobe Inc. | 0.24 | 0.26 | 0.29 | 0.29 | 0.30 | 0.30 | 0.28 | 0.29 | 0.30 | 0.30 | 0.31 | 0.35 | 0.38 | 0.39 | 0.39 | 0.40 | 0.42 | 0.42 | — | — | — | — | — | — | — | — | ||||||||
| Cadence Design Systems Inc. | 0.22 | 0.23 | 0.27 | 0.29 | 0.13 | 0.13 | 0.13 | 0.13 | 0.14 | 0.14 | 0.14 | 0.29 | 0.31 | 0.32 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| CrowdStrike Holdings Inc. | 0.60 | 0.67 | 0.72 | 0.78 | 0.82 | 0.87 | 0.85 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Fair Isaac Corp. | — | — | — | — | — | — | — | 8.46 | 4.32 | 2.69 | 2.52 | 3.75 | 4.43 | 3.81 | 2.85 | 3.07 | 3.32 | 3.65 | — | — | — | — | — | — | — | — | ||||||||
| International Business Machines Corp. | 2.59 | 2.72 | 2.32 | 2.53 | 2.59 | 2.85 | 2.74 | 2.45 | 2.51 | 2.64 | 2.99 | 3.08 | 3.15 | 3.22 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Intuit Inc. | 0.45 | 0.43 | 0.42 | 0.40 | 0.43 | 0.21 | 0.21 | 0.20 | 0.27 | 0.45 | 0.66 | 0.08 | 0.11 | 0.12 | 0.12 | 0.11 | 0.15 | 0.15 | — | — | — | — | — | — | — | — | ||||||||
| Microsoft Corp. | 0.26 | 0.28 | 0.30 | 0.31 | 0.33 | 0.35 | 0.41 | 0.43 | 0.46 | 0.52 | 0.54 | 0.58 | 0.63 | 0.66 | 0.71 | 0.77 | 0.79 | 0.89 | — | — | — | — | — | — | — | — | ||||||||
| Oracle Corp. | — | — | — | — | — | — | 16.08 | 7.79 | 8.94 | 7.46 | 5.93 | 3.63 | 3.32 | 2.95 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Palantir Technologies Inc. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.11 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Palo Alto Networks Inc. | 5.05 | 7.24 | 17.51 | 10.89 | 31.19 | 7.08 | 5.08 | 3.20 | 3.04 | 4.18 | 2.80 | 1.98 | 0.91 | 0.95 | 0.90 | 1.08 | 1.45 | 1.30 | — | — | — | — | — | — | — | — | ||||||||
| Salesforce Inc. | 0.18 | 0.18 | 0.18 | 0.19 | 0.24 | 0.06 | 0.06 | 0.07 | 0.07 | 0.08 | 0.08 | 0.08 | 0.17 | 0.19 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| ServiceNow Inc. | 0.21 | 0.27 | 0.30 | 0.33 | 0.35 | 0.39 | 0.43 | 0.45 | 0.48 | 0.53 | 0.58 | 0.64 | 0.28 | 0.31 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Synopsys Inc. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.02 | 0.02 | 0.02 | 0.03 | 0.03 | 0.03 | 0.06 | 0.08 | 0.03 | 0.04 | 0.07 | 0.14 | — | — | — | — | — | — | — | — | ||||||||
| Workday Inc. | 0.80 | 0.86 | 0.41 | 0.44 | 0.48 | 0.55 | 0.55 | 0.58 | 0.63 | 0.68 | 0.51 | 0.54 | 0.56 | 0.60 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-K (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-K (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-K (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-K (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-K (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-K (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31).
1 Q2 2023 Calculation
Debt to equity = Total debt ÷ Equity
= 20,606 ÷ 38,565 = 0.53
2 Click competitor name to see calculations.
The quarterly financial data reveals notable trends in debt, equity, and leverage ratios over the observed periods.
- Total debt
- Total debt exhibited some fluctuations but generally maintained a range between approximately 15,800 and 24,000 million US dollars. Initially, total debt remained relatively stable around the 16,000 to 18,000 range through 2016 to 2017. Beginning in early 2020, there was a marked increase, with debt peaking near 24,000 million US dollars in mid-2020, likely reflecting strategic or market-driven financial adjustments. Post this peak, debt levels decreased slightly, settling around 20,400 to 22,400 million US dollars in 2022 and early 2023.
- Equity
- Equity values showed a consistent upward trend across the timeframe. From approximately 31,700 million US dollars at the end of 2016, equity gradually increased with minor fluctuations, reaching over 38,500 million US dollars by March 2023. This steady growth indicates a strengthening of shareholders' interest and possibly retained earnings or capital infusions supporting company value.
- Debt to equity ratio
- The debt to equity ratio remained largely below 0.7 throughout the periods, indicating a moderate leverage level relative to equity. The ratio began near 0.5, demonstrating balanced capital structure. An upward trend appeared in early 2020, coinciding with increased debt, with the ratio peaking around 0.66 to 0.67 in mid to late 2020. This suggests the company increased its leverage during this period. Subsequently, the ratio declined closer to previous levels, around 0.53 to 0.55, by early 2023, reflecting a reduction in relative debt or increased equity.
Overall, the data indicates a strategic increase in debt around 2020, likely in response to external conditions or investment needs, followed by gradual deleveraging. The continued growth in equity supports a healthy capital base, maintaining a manageable balance between debt and equity financing. The company appears to sustain financial stability while navigating fluctuating leverage levels.
Debt to Capital
Visa Inc., debt to capital calculation (quarterly data)
| 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 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||||||
| Current maturities of debt | —) | —) | 2,250) | 3,249) | 3,548) | 3,247) | 999) | —) | —) | —) | 2,999) | 2,999) | 3,999) | 3,000) | —) | —) | —) | —) | —) | —) | —) | —) | 1,749) | 1,749) | 1,748) | 2,313) | ||||||||
| Long-term debt, excluding current maturities | 20,606) | 20,487) | 20,200) | 20,546) | 17,479) | 17,673) | 19,978) | 20,996) | 20,974) | 21,055) | 21,071) | 17,880) | 13,893) | 13,688) | 16,729) | 16,694) | 16,630) | 16,633) | 16,630) | 16,627) | 16,624) | 16,621) | 16,618) | 14,142) | 14,140) | 14,138) | ||||||||
| Total debt | 20,606) | 20,487) | 22,450) | 23,795) | 21,027) | 20,920) | 20,977) | 20,996) | 20,974) | 21,055) | 24,070) | 20,879) | 17,892) | 16,688) | 16,729) | 16,694) | 16,630) | 16,633) | 16,630) | 16,627) | 16,624) | 16,621) | 18,367) | 15,891) | 15,888) | 16,451) | ||||||||
| Equity | 38,565) | 36,924) | 35,581) | 35,483) | 35,989) | 36,194) | 37,589) | 37,790) | 37,696) | 37,679) | 36,210) | 35,524) | 34,585) | 35,270) | 34,684) | 34,995) | 34,275) | 34,095) | 34,006) | 33,318) | 34,103) | 33,401) | 32,760) | 31,944) | 30,783) | 31,726) | ||||||||
| Total capital | 59,171) | 57,411) | 58,031) | 59,278) | 57,016) | 57,114) | 58,566) | 58,786) | 58,670) | 58,734) | 60,280) | 56,403) | 52,477) | 51,958) | 51,413) | 51,689) | 50,905) | 50,728) | 50,636) | 49,945) | 50,727) | 50,022) | 51,127) | 47,835) | 46,671) | 48,177) | ||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||||||
| Debt to capital1 | 0.35 | 0.36 | 0.39 | 0.40 | 0.37 | 0.37 | 0.36 | 0.36 | 0.36 | 0.36 | 0.40 | 0.37 | 0.34 | 0.32 | 0.33 | 0.32 | 0.33 | 0.33 | 0.33 | 0.33 | 0.33 | 0.33 | 0.36 | 0.33 | 0.34 | 0.34 | ||||||||
| Benchmarks | ||||||||||||||||||||||||||||||||||
| Debt to Capital, Competitors2 | ||||||||||||||||||||||||||||||||||
| Accenture PLC | 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 | — | — | — | — | — | — | — | — | ||||||||
| Adobe Inc. | 0.20 | 0.20 | 0.23 | 0.22 | 0.23 | 0.23 | 0.22 | 0.22 | 0.23 | 0.23 | 0.24 | 0.26 | 0.27 | 0.28 | 0.28 | 0.29 | 0.29 | 0.29 | — | — | — | — | — | — | — | — | ||||||||
| Cadence Design Systems Inc. | 0.18 | 0.19 | 0.21 | 0.23 | 0.12 | 0.11 | 0.11 | 0.12 | 0.12 | 0.12 | 0.12 | 0.23 | 0.24 | 0.24 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| CrowdStrike Holdings Inc. | 0.38 | 0.40 | 0.42 | 0.44 | 0.45 | 0.47 | 0.46 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Fair Isaac Corp. | 1.67 | 1.72 | 1.76 | 1.76 | 1.59 | 1.49 | 1.10 | 0.89 | 0.81 | 0.73 | 0.72 | 0.79 | 0.82 | 0.79 | 0.74 | 0.75 | 0.77 | 0.79 | — | — | — | — | — | — | — | — | ||||||||
| International Business Machines Corp. | 0.72 | 0.73 | 0.70 | 0.72 | 0.72 | 0.74 | 0.73 | 0.71 | 0.72 | 0.73 | 0.75 | 0.76 | 0.76 | 0.76 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Intuit Inc. | 0.31 | 0.30 | 0.30 | 0.29 | 0.30 | 0.17 | 0.17 | 0.17 | 0.21 | 0.31 | 0.40 | 0.08 | 0.10 | 0.10 | 0.10 | 0.10 | 0.13 | 0.13 | — | — | — | — | — | — | — | — | ||||||||
| Microsoft Corp. | 0.21 | 0.22 | 0.23 | 0.23 | 0.25 | 0.26 | 0.29 | 0.30 | 0.32 | 0.34 | 0.35 | 0.37 | 0.39 | 0.40 | 0.41 | 0.44 | 0.44 | 0.47 | — | — | — | — | — | — | — | — | ||||||||
| Oracle Corp. | 1.05 | 1.07 | 1.09 | 1.12 | 1.15 | 1.02 | 0.94 | 0.89 | 0.90 | 0.88 | 0.86 | 0.78 | 0.77 | 0.75 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Palantir Technologies Inc. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.10 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Palo Alto Networks Inc. | 0.83 | 0.88 | 0.95 | 0.92 | 0.97 | 0.88 | 0.84 | 0.76 | 0.75 | 0.81 | 0.74 | 0.66 | 0.48 | 0.49 | 0.47 | 0.52 | 0.59 | 0.56 | — | — | — | — | — | — | — | — | ||||||||
| Salesforce Inc. | 0.15 | 0.15 | 0.15 | 0.16 | 0.19 | 0.06 | 0.06 | 0.06 | 0.07 | 0.07 | 0.07 | 0.08 | 0.15 | 0.16 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| ServiceNow Inc. | 0.18 | 0.21 | 0.23 | 0.25 | 0.26 | 0.28 | 0.30 | 0.31 | 0.33 | 0.35 | 0.37 | 0.39 | 0.22 | 0.24 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Synopsys Inc. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.02 | 0.02 | 0.02 | 0.02 | 0.03 | 0.03 | 0.05 | 0.07 | 0.03 | 0.03 | 0.07 | 0.13 | — | — | — | — | — | — | — | — | ||||||||
| Workday Inc. | 0.45 | 0.46 | 0.29 | 0.30 | 0.32 | 0.35 | 0.35 | 0.37 | 0.39 | 0.41 | 0.34 | 0.35 | 0.36 | 0.37 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-K (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-K (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-K (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-K (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-K (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-K (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31).
1 Q2 2023 Calculation
Debt to capital = Total debt ÷ Total capital
= 20,606 ÷ 59,171 = 0.35
2 Click competitor name to see calculations.
The financial data reveals the following trends and observations over the analyzed period:
- Total Debt
- The total debt level generally remains within a narrow range from the end of 2016 through 2019, fluctuating between approximately 16,400 and 16,700 million US dollars. Starting in early 2020, there is a clear upward trend with debt rising sharply, peaking around 24,070 million in the third quarter of 2020. Subsequently, debt levels decrease gradually but remain elevated relative to the pre-2020 period, ending near 20,600 million as of the first quarter of 2023.
- Total Capital
- Total capital presents a steady increase from about 48,000 million US dollars at the end of 2016 to over 51,000 million by late 2019. Beginning in early 2020, total capital continues to climb more noticeably, reaching a peak exceeding 60,000 million in mid-2020 and mid-2021 intervals. Towards the first quarter of 2023, total capital fluctuates but remains at relatively high levels, around 57,000 to 59,000 million US dollars, indicating growth in overall capital base despite some short-term variability.
- Debt to Capital Ratio
- This ratio is relatively stable near one-third throughout the initial three years, ranging from 0.32 to 0.36. The onset of 2020 marks an increase in leverage as the ratio rises, approaching 0.40 by mid-2020. After peaking, the ratio exhibits a modest decline but stays elevated compared to pre-2020 figures, oscillating between 0.35 and 0.39 through early 2023. This pattern suggests increased reliance on debt financing during and after the 2020 period, which has not fully reverted to earlier levels.
Overall, the data indicates moderate growth in total capital and a marked increase in debt and leverage starting in 2020, likely reflecting strategic financial adjustments. Despite some subsequent debt reduction, the company's capital structure demonstrates a persistently higher debt proportion relative to earlier years, implying ongoing changes in funding and capitalization strategy.
Debt to Assets
Visa Inc., debt to assets calculation (quarterly data)
| 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 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||||||
| Current maturities of debt | —) | —) | 2,250) | 3,249) | 3,548) | 3,247) | 999) | —) | —) | —) | 2,999) | 2,999) | 3,999) | 3,000) | —) | —) | —) | —) | —) | —) | —) | —) | 1,749) | 1,749) | 1,748) | 2,313) | ||||||||
| Long-term debt, excluding current maturities | 20,606) | 20,487) | 20,200) | 20,546) | 17,479) | 17,673) | 19,978) | 20,996) | 20,974) | 21,055) | 21,071) | 17,880) | 13,893) | 13,688) | 16,729) | 16,694) | 16,630) | 16,633) | 16,630) | 16,627) | 16,624) | 16,621) | 16,618) | 14,142) | 14,140) | 14,138) | ||||||||
| Total debt | 20,606) | 20,487) | 22,450) | 23,795) | 21,027) | 20,920) | 20,977) | 20,996) | 20,974) | 21,055) | 24,070) | 20,879) | 17,892) | 16,688) | 16,729) | 16,694) | 16,630) | 16,633) | 16,630) | 16,627) | 16,624) | 16,621) | 18,367) | 15,891) | 15,888) | 16,451) | ||||||||
| Total assets | 86,755) | 85,387) | 85,501) | 85,410) | 81,808) | 81,929) | 82,896) | 82,671) | 80,195) | 80,426) | 80,919) | 77,884) | 72,820) | 74,781) | 72,574) | 70,249) | 69,865) | 71,655) | 69,225) | 68,175) | 69,042) | 67,154) | 67,977) | 64,000) | 63,227) | 63,370) | ||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||||||
| Debt to assets1 | 0.24 | 0.24 | 0.26 | 0.28 | 0.26 | 0.26 | 0.25 | 0.25 | 0.26 | 0.26 | 0.30 | 0.27 | 0.25 | 0.22 | 0.23 | 0.24 | 0.24 | 0.23 | 0.24 | 0.24 | 0.24 | 0.25 | 0.27 | 0.25 | 0.25 | 0.26 | ||||||||
| Benchmarks | ||||||||||||||||||||||||||||||||||
| Debt to Assets, Competitors2 | ||||||||||||||||||||||||||||||||||
| Accenture PLC | 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 | — | — | — | — | — | — | — | — | ||||||||
| Adobe Inc. | 0.13 | 0.14 | 0.15 | 0.15 | 0.16 | 0.16 | 0.15 | 0.16 | 0.16 | 0.16 | 0.17 | 0.18 | 0.19 | 0.19 | 0.20 | 0.21 | 0.21 | 0.21 | — | — | — | — | — | — | — | — | ||||||||
| Cadence Design Systems Inc. | 0.13 | 0.13 | 0.15 | 0.16 | 0.08 | 0.08 | 0.08 | 0.08 | 0.08 | 0.09 | 0.09 | 0.17 | 0.17 | 0.18 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| CrowdStrike Holdings Inc. | 0.18 | 0.19 | 0.20 | 0.22 | 0.24 | 0.26 | 0.27 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Fair Isaac Corp. | 1.28 | 1.32 | 1.29 | 1.34 | 1.21 | 1.12 | 0.80 | 0.66 | 0.61 | 0.55 | 0.52 | 0.59 | 0.61 | 0.59 | 0.58 | 0.60 | 0.62 | 0.64 | — | — | — | — | — | — | — | — | ||||||||
| International Business Machines Corp. | 0.43 | 0.44 | 0.40 | 0.40 | 0.39 | 0.41 | 0.39 | 0.38 | 0.38 | 0.38 | 0.39 | 0.42 | 0.42 | 0.42 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Intuit Inc. | 0.26 | 0.26 | 0.25 | 0.24 | 0.26 | 0.14 | 0.13 | 0.13 | 0.16 | 0.24 | 0.31 | 0.05 | 0.06 | 0.07 | 0.07 | 0.06 | 0.08 | 0.09 | — | — | — | — | — | — | — | — | ||||||||
| Microsoft Corp. | 0.13 | 0.14 | 0.14 | 0.14 | 0.16 | 0.16 | 0.17 | 0.19 | 0.20 | 0.21 | 0.21 | 0.23 | 0.25 | 0.25 | 0.25 | 0.28 | 0.28 | 0.30 | — | — | — | — | — | — | — | — | ||||||||
| Oracle Corp. | 0.71 | 0.70 | 0.69 | 0.72 | 0.73 | 0.67 | 0.64 | 0.59 | 0.64 | 0.62 | 0.62 | 0.53 | 0.52 | 0.51 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Palantir Technologies Inc. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.07 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Palo Alto Networks Inc. | 0.28 | 0.29 | 0.30 | 0.33 | 0.35 | 0.35 | 0.31 | 0.33 | 0.33 | 0.36 | 0.34 | 0.23 | 0.20 | 0.21 | 0.22 | 0.25 | 0.27 | 0.28 | — | — | — | — | — | — | — | — | ||||||||
| Salesforce Inc. | 0.11 | 0.11 | 0.11 | 0.12 | 0.15 | 0.04 | 0.04 | 0.05 | 0.05 | 0.05 | 0.05 | 0.06 | 0.09 | 0.10 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| ServiceNow Inc. | 0.10 | 0.11 | 0.11 | 0.13 | 0.13 | 0.14 | 0.15 | 0.17 | 0.17 | 0.18 | 0.19 | 0.22 | 0.11 | 0.11 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Synopsys Inc. | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.01 | 0.01 | 0.01 | 0.02 | 0.02 | 0.02 | 0.03 | 0.05 | 0.02 | 0.02 | 0.05 | 0.09 | — | — | — | — | — | — | — | — | ||||||||
| Workday Inc. | 0.31 | 0.32 | 0.18 | 0.20 | 0.20 | 0.22 | 0.21 | 0.23 | 0.24 | 0.25 | 0.19 | 0.20 | 0.21 | 0.21 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-K (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-K (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-K (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-K (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-K (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-K (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31).
1 Q2 2023 Calculation
Debt to assets = Total debt ÷ Total assets
= 20,606 ÷ 86,755 = 0.24
2 Click competitor name to see calculations.
The data demonstrates fluctuations in total debt, total assets, and the debt to assets ratio over the analyzed multi-year period, reflecting varying financial leverage and asset base changes.
- Total Debt
- Total debt levels remained relatively stable around the 16,000 to 17,000 million US$ range through the end of 2019. From early 2020, there was a noticeable increase, peaking in the third quarter of 2020 at approximately 24,070 million US$. Following this peak, total debt declined somewhat but stayed elevated compared to pre-2020 levels, fluctuating in a range roughly between 20,000 and 23,000 million US$ up to the first quarter of 2023. This suggests a significant rise in debt during the early stages of 2020 with some subsequent repayments or adjustments thereafter.
- Total Assets
- Total assets showed a generally upward trend throughout the period, increasing from approximately 63,000 million US$ at the end of 2016 to around 86,700 million US$ by the first quarter of 2023. Although there were some quarters with minor contractions, the trajectory was predominantly positive, with occasional step-ups notably visible in mid to late 2020 and subsequent years. This growth in total assets reflects asset acquisition, investment, or valuation increases during this timeframe.
- Debt to Assets Ratio
- The debt to assets ratio stayed relatively consistent between 0.22 and 0.27 for most of the period but showed some variation aligned with changes in debt and asset levels. Early in the timeline, the ratio hovered near 0.25 to 0.27. It then dipped to a low around 0.22 at the end of 2019, indicating slightly reduced leverage. However, this was followed by a rise to 0.3 in the third quarter of 2020, corresponding with the peak in total debt amid a generally growing asset base. The ratio then moderated to levels between 0.24 and 0.28 through the most recent quarters, showing that while debt increased relatively more sharply during 2020, leverage levels settled back to moderate levels over time.
Overall, the financial data indicates that the entity increased both debt and assets over the period examined, with a pronounced surge in debt around 2020 possibly linked to external factors affecting capital structure. Although the leverage ratio peaked during that phase, it was largely controlled and stabilized thereafter. The asset base expansion suggests ongoing investments or growth opportunities were pursued, maintaining a balance between debt usage and asset growth.
Financial Leverage
Visa Inc., financial leverage calculation (quarterly data)
| 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 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||||||
| Total assets | 86,755) | 85,387) | 85,501) | 85,410) | 81,808) | 81,929) | 82,896) | 82,671) | 80,195) | 80,426) | 80,919) | 77,884) | 72,820) | 74,781) | 72,574) | 70,249) | 69,865) | 71,655) | 69,225) | 68,175) | 69,042) | 67,154) | 67,977) | 64,000) | 63,227) | 63,370) | ||||||||
| Equity | 38,565) | 36,924) | 35,581) | 35,483) | 35,989) | 36,194) | 37,589) | 37,790) | 37,696) | 37,679) | 36,210) | 35,524) | 34,585) | 35,270) | 34,684) | 34,995) | 34,275) | 34,095) | 34,006) | 33,318) | 34,103) | 33,401) | 32,760) | 31,944) | 30,783) | 31,726) | ||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||||||
| Financial leverage1 | 2.25 | 2.31 | 2.40 | 2.41 | 2.27 | 2.26 | 2.21 | 2.19 | 2.13 | 2.13 | 2.23 | 2.19 | 2.11 | 2.12 | 2.09 | 2.01 | 2.04 | 2.10 | 2.04 | 2.05 | 2.02 | 2.01 | 2.08 | 2.00 | 2.05 | 2.00 | ||||||||
| Benchmarks | ||||||||||||||||||||||||||||||||||
| Financial Leverage, Competitors2 | ||||||||||||||||||||||||||||||||||
| Accenture PLC | 2.01 | 2.05 | 2.14 | 2.16 | 2.16 | 2.15 | 2.21 | 2.18 | 2.18 | 2.14 | 2.18 | 2.19 | 2.17 | 2.19 | 2.07 | 2.05 | 2.05 | 2.11 | — | — | — | — | — | — | — | — | ||||||||
| Adobe Inc. | 1.88 | 1.88 | 1.93 | 1.86 | 1.88 | 1.89 | 1.84 | 1.81 | 1.85 | 1.84 | 1.83 | 1.91 | 1.99 | 2.03 | 1.97 | 1.96 | 1.98 | 1.98 | — | — | — | — | — | — | — | — | ||||||||
| Cadence Design Systems Inc. | 1.77 | 1.76 | 1.87 | 1.83 | 1.66 | 1.59 | 1.60 | 1.60 | 1.64 | 1.57 | 1.58 | 1.73 | 1.77 | 1.75 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| CrowdStrike Holdings Inc. | 3.39 | 3.48 | 3.53 | 3.48 | 3.47 | 3.39 | 3.14 | 2.15 | 2.04 | 2.02 | 1.89 | 1.75 | 1.61 | 6.29 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Fair Isaac Corp. | — | — | — | — | — | — | — | 12.73 | 7.07 | 4.87 | 4.85 | 6.33 | 7.25 | 6.41 | 4.95 | 5.12 | 5.37 | 5.73 | — | — | — | — | — | — | — | — | ||||||||
| International Business Machines Corp. | 5.96 | 6.19 | 5.80 | 6.27 | 6.57 | 7.00 | 6.98 | 6.49 | 6.69 | 6.95 | 7.57 | 7.27 | 7.50 | 7.67 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Intuit Inc. | 1.72 | 1.69 | 1.69 | 1.68 | 1.69 | 1.53 | 1.57 | 1.58 | 1.65 | 1.85 | 2.14 | 1.64 | 1.80 | 1.70 | 1.68 | 1.70 | 1.91 | 1.77 | — | — | — | — | — | — | — | — | ||||||||
| Microsoft Corp. | 1.99 | 2.07 | 2.19 | 2.12 | 2.13 | 2.21 | 2.35 | 2.30 | 2.34 | 2.44 | 2.55 | 2.49 | 2.57 | 2.63 | 2.80 | 2.78 | 2.81 | 3.00 | — | — | — | — | — | — | — | — | ||||||||
| Oracle Corp. | — | — | — | — | — | — | 25.03 | 13.27 | 13.90 | 11.96 | 9.56 | 6.79 | 6.33 | 5.76 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Palantir Technologies Inc. | 1.35 | 1.35 | 1.35 | 1.39 | 1.40 | 1.40 | 1.42 | 1.43 | 1.49 | 1.67 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Palo Alto Networks Inc. | 18.06 | 24.69 | 58.35 | 32.88 | 88.29 | 20.09 | 16.14 | 9.59 | 9.15 | 11.68 | 8.23 | 8.73 | 4.47 | 4.50 | 4.16 | 4.31 | 5.33 | 4.63 | — | — | — | — | — | — | — | — | ||||||||
| Salesforce Inc. | 1.57 | 1.58 | 1.64 | 1.53 | 1.60 | 1.52 | 1.60 | 1.47 | 1.50 | 1.55 | 1.63 | 1.50 | 1.94 | 2.02 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| ServiceNow Inc. | 2.15 | 2.43 | 2.64 | 2.46 | 2.65 | 2.75 | 2.92 | 2.68 | 2.81 | 2.90 | 3.07 | 2.88 | 2.63 | 2.73 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Synopsys Inc. | 1.68 | 1.70 | 1.71 | 1.66 | 1.66 | 1.65 | 1.65 | 1.65 | 1.64 | 1.64 | 1.64 | 1.67 | 1.71 | 1.74 | 1.57 | 1.56 | 1.58 | 1.68 | — | — | — | — | — | — | — | — | ||||||||
| Workday Inc. | 2.58 | 2.68 | 2.31 | 2.24 | 2.36 | 2.53 | 2.66 | 2.55 | 2.64 | 2.78 | 2.74 | 2.65 | 2.71 | 2.85 | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-K (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-K (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-K (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-K (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-K (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-K (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31).
1 Q2 2023 Calculation
Financial leverage = Total assets ÷ Equity
= 86,755 ÷ 38,565 = 2.25
2 Click competitor name to see calculations.
The analysis of the financial data over multiple quarters reveals several notable trends with respect to the company’s asset base, equity, and financial leverage ratios.
- Total Assets
- The total assets show a generally increasing trend over the period analyzed. Starting from 63,370 million US dollars at the end of 2016, the assets grew consistently reaching 80,426 million by the third quarter of 2020. Although there was some fluctuation afterward, total assets continued to rise towards the end of the period, finishing at 86,755 million US dollars by March 31, 2023. This steady growth indicates the company’s expansion or asset accumulation strategy over the years.
- Equity
- Equity levels also followed an upward trend but with more variability compared to total assets. Beginning at 31,726 million US dollars at the end of 2016, equity generally increased with slight dips in some quarters, such as the decline in early 2022. The equity value peaked around 38,565 million US dollars in March 2023. Overall, the increase in equity alongside asset growth suggests retained earnings and possible capital injections supporting the company’s financial foundation.
- Financial Leverage Ratio
- The financial leverage ratio remained relatively stable but showed a modest upward trend. It started from a ratio of approximately 2 at the end of 2016, indicating that assets were approximately twice the equity value. Gradually, the ratio increased over the years, reaching around 2.25 by March 2023, with intermittent fluctuations. The ratio’s increase implies that the company modestly increased its use of debt relative to equity financing, but maintained a consistent leverage level overall.
In summary, the company exhibited consistent asset growth and increasing equity, denoting a strengthening financial position with moderate leverage expansion. The interplay between these metrics suggests a balanced approach to financing that supports growth while managing financial risk.
Interest Coverage
Visa Inc., interest coverage calculation (quarterly data)
| 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 | Dec 31, 2020 | Sep 30, 2020 | Jun 30, 2020 | Mar 31, 2020 | Dec 31, 2019 | Sep 30, 2019 | Jun 30, 2019 | Mar 31, 2019 | Dec 31, 2018 | Sep 30, 2018 | Jun 30, 2018 | Mar 31, 2018 | Dec 31, 2017 | Sep 30, 2017 | Jun 30, 2017 | Mar 31, 2017 | Dec 31, 2016 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||||||||||||||||||||||||||||||
| Net income | 4,257) | 4,179) | 3,940) | 3,411) | 3,647) | 3,959) | 3,584) | 2,575) | 3,026) | 3,126) | 2,137) | 2,373) | 3,084) | 3,272) | 3,025) | 3,101) | 2,977) | 2,977) | 2,845) | 2,329) | 2,605) | 2,522) | 2,140) | 2,059) | 430) | 2,070) | ||||||||
| Add: Income tax expense | 1,021) | 798) | 928) | 418) | 895) | 938) | 714) | 1,814) | 602) | 622) | 918) | 559) | 745) | 702) | 686) | 765) | 700) | 653) | 693) | 483) | 612) | 717) | 959) | 855) | 2,272) | 909) | ||||||||
| Add: Interest expense | 142) | 137) | 159) | 111) | 134) | 134) | 125) | 131) | 121) | 136) | 145) | 142) | 118) | 111) | 120) | 128) | 140) | 145) | 150) | 155) | 153) | 154) | 148) | 140) | 135) | 140) | ||||||||
| Earnings before interest and tax (EBIT) | 5,420) | 5,114) | 5,027) | 3,940) | 4,676) | 5,031) | 4,423) | 4,520) | 3,749) | 3,884) | 3,200) | 3,074) | 3,947) | 4,085) | 3,831) | 3,994) | 3,817) | 3,775) | 3,688) | 2,967) | 3,370) | 3,393) | 3,247) | 3,054) | 2,837) | 3,119) | ||||||||
| Solvency Ratio | ||||||||||||||||||||||||||||||||||
| Interest coverage1 | 35.52 | 34.67 | 34.71 | 35.85 | 35.59 | 34.68 | 32.31 | 28.80 | 25.56 | 26.07 | 27.72 | 30.42 | 33.24 | 31.52 | 28.92 | 27.13 | 24.15 | 22.89 | 21.92 | 21.27 | 21.96 | 21.72 | 21.77 | — | — | — | ||||||||
| Benchmarks | ||||||||||||||||||||||||||||||||||
| Interest Coverage, Competitors2 | ||||||||||||||||||||||||||||||||||
| Accenture PLC | 212.89 | 217.31 | 195.34 | 188.01 | 133.08 | 133.32 | 131.46 | 126.89 | 196.99 | 191.96 | 205.84 | 248.30 | 245.62 | 270.18 | 273.26 | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Adobe Inc. | 55.57 | 53.27 | 54.64 | 54.21 | 54.34 | 53.39 | 51.49 | 49.52 | 45.92 | 42.50 | 37.00 | 32.36 | 28.08 | 23.87 | 21.38 | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Cadence Design Systems Inc. | 34.13 | 38.63 | 46.58 | 57.84 | 58.34 | 52.92 | 46.26 | 44.21 | 40.38 | 35.68 | 31.50 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| CrowdStrike Holdings Inc. | -4.71 | -5.09 | -5.34 | -6.41 | -8.16 | -12.40 | -55.36 | -151.33 | -185.47 | -226.03 | -315.25 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Fair Isaac Corp. | 6.67 | 7.09 | 7.83 | 8.91 | 11.63 | 12.49 | 12.80 | 12.23 | 9.16 | 8.21 | 7.09 | 6.72 | 6.92 | 6.54 | 6.44 | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| International Business Machines Corp. | 2.34 | 2.25 | 1.95 | 1.59 | 6.01 | 5.40 | 5.19 | 3.79 | 4.56 | 4.97 | 4.60 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Intuit Inc. | 16.17 | 19.99 | 32.38 | 55.36 | 62.71 | 93.29 | 89.14 | 92.00 | 89.58 | 120.30 | 158.00 | 158.50 | 164.67 | 148.46 | 126.40 | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Oracle Corp. | 4.41 | 3.33 | 3.78 | 3.98 | 4.23 | 6.06 | 6.21 | 6.27 | 6.48 | 6.76 | 7.05 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Palantir Technologies Inc. | -5.32 | -49.82 | -87.97 | -176.15 | -201.09 | -194.27 | -133.20 | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Palo Alto Networks Inc. | 4.05 | -1.99 | -6.56 | -4.28 | -3.42 | -2.65 | -1.85 | -1.68 | -1.49 | -1.36 | -1.61 | -1.55 | -0.92 | -0.09 | 0.11 | — | — | — | — | — | — | — | — | — | — | — | ||||||||
| Synopsys Inc. | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||
Based on: 10-Q (reporting date: 2023-03-31), 10-Q (reporting date: 2022-12-31), 10-K (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31), 10-Q (reporting date: 2021-12-31), 10-K (reporting date: 2021-09-30), 10-Q (reporting date: 2021-06-30), 10-Q (reporting date: 2021-03-31), 10-Q (reporting date: 2020-12-31), 10-K (reporting date: 2020-09-30), 10-Q (reporting date: 2020-06-30), 10-Q (reporting date: 2020-03-31), 10-Q (reporting date: 2019-12-31), 10-K (reporting date: 2019-09-30), 10-Q (reporting date: 2019-06-30), 10-Q (reporting date: 2019-03-31), 10-Q (reporting date: 2018-12-31), 10-K (reporting date: 2018-09-30), 10-Q (reporting date: 2018-06-30), 10-Q (reporting date: 2018-03-31), 10-Q (reporting date: 2017-12-31), 10-K (reporting date: 2017-09-30), 10-Q (reporting date: 2017-06-30), 10-Q (reporting date: 2017-03-31), 10-Q (reporting date: 2016-12-31).
1 Q2 2023 Calculation
Interest coverage
= (EBITQ2 2023
+ EBITQ1 2023
+ EBITQ4 2022
+ EBITQ3 2022)
÷ (Interest expenseQ2 2023
+ Interest expenseQ1 2023
+ Interest expenseQ4 2022
+ Interest expenseQ3 2022)
= (5,420 + 5,114 + 5,027 + 3,940)
÷ (142 + 137 + 159 + 111)
= 35.52
2 Click competitor name to see calculations.
The earnings before interest and tax (EBIT) exhibited fluctuations over the reported quarterly periods. Starting at 3,119 million US dollars at the end of 2016, EBIT experienced a declining trend through the first half of 2017, reaching 2,967 million in June 2018. Subsequently, there was a general upward movement until the fourth quarter of 2019, where EBIT peaked at 4,085 million US dollars. The periods of 2020 displayed volatility, with EBIT dropping notably to 3,074 million in the second quarter, amid a context that might suggest external economic pressures. However, the EBIT rebounded by the last quarter of 2020 to 3,884 million and continued on an upward trajectory through 2021 and into early 2023, culminating in 5,420 million US dollars at the end of the first quarter of 2023. This overall trend indicates resilience and growth after a period of decline and instability.
Interest expense showed a relatively stable pattern with minor variations. Beginning at 140 million US dollars at the end of 2016, it maintained a range mostly between 111 and 159 million across the entire timeline. A slight increase was noted in the quarters surrounding early 2020 and early 2023, peaking at 159 million US dollars in the fourth quarter of 2022. Despite these fluctuations, interest expense did not exhibit a clear upward or downward trend but remained fairly consistent in magnitude.
Interest coverage ratio data is partially available, starting only from the period ending March 31, 2017. The ratio began at 21.77 and generally increased throughout the subsequent quarters, reaching values above 30 by the mid-to-late 2019. In 2020, the coverage ratio experienced some decline from its peak but still remained above 25, indicating sufficient earnings relative to interest obligations. From 2021 into early 2023, the interest coverage ratio demonstrated continued strength, surpassing 34 in several quarters. This pattern reflects improved or sustained ability to service interest expenses comfortably relative to EBIT over the examined periods.