GURUFOCUS.COM » STOCK LIST » Technology » Semiconductors » ARM Holdings PLC (NAS:ARM) » Definitions » Debt-to-EBITDA

ARM Holdings (ARM Holdings) Debt-to-EBITDA : 0.31 (As of Dec. 2023)


View and export this data going back to 2023. Start your Free Trial

What is ARM Holdings Debt-to-EBITDA?

Debt-to-EBITDA measures a company's ability to pay off its debt.

ARM Holdings's Short-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2023 was $31 Mil. ARM Holdings's Long-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2023 was $195 Mil. ARM Holdings's annualized EBITDA for the quarter that ended in Dec. 2023 was $728 Mil. ARM Holdings's annualized Debt-to-EBITDA for the quarter that ended in Dec. 2023 was 0.31.

A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt. According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.

The historical rank and industry rank for ARM Holdings's Debt-to-EBITDA or its related term are showing as below:

ARM' s Debt-to-EBITDA Range Over the Past 10 Years
Min: 0.26   Med: 0.28   Max: 1.08
Current: 1.08

During the past 3 years, the highest Debt-to-EBITDA Ratio of ARM Holdings was 1.08. The lowest was 0.26. And the median was 0.28.

ARM's Debt-to-EBITDA is ranked better than
58.17% of 710 companies
in the Semiconductors industry
Industry Median: 1.605 vs ARM: 1.08

ARM Holdings Debt-to-EBITDA Historical Data

The historical data trend for ARM Holdings's Debt-to-EBITDA can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

ARM Holdings Debt-to-EBITDA Chart

ARM Holdings Annual Data
Trend Mar21 Mar22 Mar23
Debt-to-EBITDA
- 0.30 0.26

ARM Holdings Quarterly Data
Mar21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23
Debt-to-EBITDA Get a 7-Day Free Trial Premium Member Only - -6.08 0.37 -0.47 0.31

Competitive Comparison of ARM Holdings's Debt-to-EBITDA

For the Semiconductors subindustry, ARM Holdings's Debt-to-EBITDA, along with its competitors' market caps and Debt-to-EBITDA data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

ARM Holdings's Debt-to-EBITDA Distribution in the Semiconductors Industry

For the Semiconductors industry and Technology sector, ARM Holdings's Debt-to-EBITDA distribution charts can be found below:

* The bar in red indicates where ARM Holdings's Debt-to-EBITDA falls into.


ARM Holdings Debt-to-EBITDA Calculation

Debt-to-EBITDA measures a company's ability to pay off its debt.

ARM Holdings's Debt-to-EBITDA for the fiscal year that ended in Mar. 2023 is calculated as

Debt-to-EBITDA=Total Debt / EBITDA
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / EBITDA
=(26 + 193) / 848
=0.26

ARM Holdings's annualized Debt-to-EBITDA for the quarter that ended in Dec. 2023 is calculated as

Debt-to-EBITDA=Total Debt / EBITDA
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / EBITDA
=(31 + 195) / 728
=0.31

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

In the calculation of annual Debt-to-EBITDA, the EBITDA of the last fiscal year is used. In calculating the annualized quarterly data, the EBITDA data used here is four times the quarterly (Dec. 2023) EBITDA data.

ARM Holdings  (NAS:ARM) Debt-to-EBITDA Explanation

In the calculation of Debt-to-EBITDA, we use the total of Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation divided by EBITDA. In some calculations, Total Liabilities is used to for calculation.

Be Aware

A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt.

According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.

ARM Holdings Debt-to-EBITDA Related Terms

Thank you for viewing the detailed overview of ARM Holdings's Debt-to-EBITDA provided by GuruFocus.com. Please click on the following links to see related term pages.

ARM Holdings (ARM Holdings) Business Description

Industry
GURUFOCUS.COM » STOCK LIST » Technology » Semiconductors » ARM Holdings PLC (NAS:ARM) » Definitions » Debt-to-EBITDA
Comparable Companies
NXPI MRVL MCHP ON MU GFS ADI MPWR SWKS QRVO NVDA TPE:2330 AVGO AMD INTC TXN QCOM XKRX:000660 TPE:2454 XTER:IFX
Traded in Other Exchanges
ARM:Mexico O9T:Germany O9T:Germany O9T:Germany
Address
110 Fulbourn Road, Cambridge, GBR, CB1 9NJ
Website
https://www.arm.com
Arm Holdings is the IP owner and developer of the ARM architecture (ARM stands for Acorn RISC Machine), which is used in 99% of the world's smartphone CPU cores, and it also has high market share in other battery-powered devices like wearables, tablets, or sensors. Arm licenses its architecture for a fee, offering different types of licenses depending on the flexibility the customer needs. Customers like Apple or Qualcomm buy architectural licenses, which allows them to modify the architecture and add or delete instructions to tailor the chips to their specific needs. Other clients directly buy off-the-shelf designs from Arm. Both off-the-shelf and architectural customers pay a royalty fee per chip shipped.