GURUFOCUS.COM » STOCK LIST » Communication Services » Telecommunication Services » AT&T Inc (NYSE:T) » Definitions » Interest Coverage

AT&T (T) Interest Coverage : 3.90 (As of Sep. 2024)


View and export this data going back to 1946. Start your Free Trial

What is AT&T Interest Coverage?

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. AT&T's Operating Income for the three months ended in Sep. 2024 was $6,538 Mil. AT&T's Interest Expense for the three months ended in Sep. 2024 was $-1,675 Mil. AT&T's interest coverage for the quarter that ended in Sep. 2024 was 3.90. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for AT&T's Interest Coverage or its related term are showing as below:

T' s Interest Coverage Range Over the Past 10 Years
Min: 3.19   Med: 3.72   Max: 6.02
Current: 3.61


T's Interest Coverage is ranked worse than
56.64% of 286 companies
in the Telecommunication Services industry
Industry Median: 4.53 vs T: 3.61

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.


AT&T Interest Coverage Historical Data

The historical data trend for AT&T's Interest Coverage 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.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

* Premium members only.

AT&T Interest Coverage Chart

AT&T Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Interest Coverage
Get a 7-Day Free Trial Premium Member Only Premium Member Only 3.49 3.19 3.89 3.75 3.68

AT&T Quarterly Data
Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24
Interest Coverage Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 3.84 3.40 3.48 3.67 3.90

Competitive Comparison of AT&T's Interest Coverage

For the Telecom Services subindustry, AT&T's Interest Coverage, along with its competitors' market caps and Interest Coverage 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.


AT&T's Interest Coverage Distribution in the Telecommunication Services Industry

For the Telecommunication Services industry and Communication Services sector, AT&T's Interest Coverage distribution charts can be found below:

* The bar in red indicates where AT&T's Interest Coverage falls into.



AT&T Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage=-1* Operating Income /Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt (1).


Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

AT&T's Interest Coverage for the fiscal year that ended in Dec. 2023 is calculated as

Here, for the fiscal year that ended in Dec. 2023, AT&T's Interest Expense was $-6,704 Mil. Its Operating Income was $24,654 Mil. And its Long-Term Debt & Capital Lease Obligation was $145,422 Mil.

Interest Coverage=-1* Operating Income (A: Dec. 2023 )/Interest Expense (A: Dec. 2023 )
=-1*24654/-6704
=3.68

AT&T's Interest Coverage for the quarter that ended in Sep. 2024 is calculated as

Here, for the three months ended in Sep. 2024, AT&T's Interest Expense was $-1,675 Mil. Its Operating Income was $6,538 Mil. And its Long-Term Debt & Capital Lease Obligation was $143,706 Mil.

Interest Coverage=-1* Operating Income (Q: Sep. 2024 )/Interest Expense (Q: Sep. 2024 )
=-1*6538/-1675
=3.90

* 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.

The higher the ratio, the stronger the company's Financial Strength is.


AT&T  (NYSE:T) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .


AT&T Interest Coverage Related Terms

Thank you for viewing the detailed overview of AT&T's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.


AT&T Business Description

Address
208 S. Akard Street, Dallas, TX, USA, 75202
The wireless business contributes nearly 70% of AT&T's revenue. The firm is the third-largest US wireless carrier, connecting 72 million postpaid and 17 million prepaid phone customers. Fixed-line enterprise services, which account for about 16% of revenue, include internet access, private networking, security, voice, and wholesale network capacity. Residential fixed-line services, about 11% of revenue, primarily consist of broadband internet access, serving 14 million customers. AT&T also has a sizable presence in Mexico, with 23 million customers, but this business only accounts for 4% of revenue. The firm still holds a 70% equity stake in satellite television provider DirecTV but does not consolidate this business in its financial statements.
Executives
Sanders S Sabrina officer: SVP-ChiefActngOfcr&Controller 208 S. AKARD ST., 29TH FLOOR, DALLAS TX 75202
Debra L. Dial officer: SVP-ChiefActngOfcr&Controller 208 S. AKARD, 29TH FLOOR, DALLAS TX 75202
Jeremy Alan Legg officer: Chief Technology Officer 208 S. AKARD STREET, DALLAS TX 75202
Kenny Kellyn Smith officer: Chief Marketing & Growth Ofcr 208 S. AKARD ST, 29TH FLOOR, DALLAS TX 75202
Edward W Gillespie officer: SrEVP-Ext & Legal Affairs 208 S. AKARD, DALLAS TX 75202
Angela Santone officer: Sr. Exec VP-Human Resources 208 S. AKARD ST, DALLAS TX 75202
Jeffery S. Mcelfresh officer: CEO, AT&T Communications, LLC 208 S. AKARD, 29TH FLOOR, DALLAS TX 75202
Mcatee David R Ii officer: Sr. Exec. VP and Gen. Counsel 208 S. AKARD, 29TH FLOOR, DALLAS TX 75202
David S. Huntley officer: SEVP&Chief Compliance Officer 208 S. AKARD, ROOM 2900;07, DALLAS TX 75202
Lori M Lee officer: CEO-AT&T LatAm&GlobalMktgOfcr 208 S. AKARD ST., 29TH FLOOR, DALLAS TX 75202
Pascal Desroches officer: Sr. Exec VP and CFO AT&T INC., 208 S AKARD STREET, DALLAS TX 75202
Stephen J Luczo director
Luis A Ubinas director 209 REDWOOD SHORES PARKWAY, REDWOOD CITY CA 94065-1175
John T Stankey officer: Sr. Exec. VP and CIO 208 S. AKARD ST., 29TH FLOOR, DALLAS TX 75202
Jason Kilar officer: CEO, Warner Media, LLC 208 S. AKARD ST, DALLAS TX 75202