What is Honeywell Intl Inc's earnings per share (EPS)?

Honeywell Intl Inc (HONIV) reported diluted earnings per share of $7.36 for fiscal year 2025. This represents a -15.5% change compared to the previous fiscal year. EPS represents the portion of a company's net income allocated to each outstanding share of common stock and is widely used to evaluate profitability on a per-share basis.

Honeywell Intl Inc Financials

HONIV

Source SEC Filings (10-K/10-Q) Data as of Mar 31, 2026 Currency USD FYE December

This page shows Honeywell Intl Inc (HONIV) financial statements, including the income statement, balance sheet, cash flow statement, and key financial ratios. View 19 years of annual fundamentals and quarterly data, with year-over-year growth rates and compound annual growth rates (CAGR). All figures are derived from SEC filings (10-K and 10-Q reports).

Financial Health Signals

Financial health score pending refresh

We are recalculating Honeywell Intl Inc's peer-relative financial health score against the latest fiscal year. It will appear here once the refresh completes. The signals and metrics below are current.

Piotroski F-Score Neutral

5/9

Honeywell Intl Inc passes 5 of 9 financial strength tests. 3 of 4 profitability signals pass, 1 of 3 leverage/liquidity signals pass, 1 of 2 efficiency signals pass.

Earnings Quality Cash-Backed

1.36x

For every $1 of reported earnings, Honeywell Intl Inc generates $1.36 in operating cash flow ($6.4B OCF vs $4.7B net income). This indicates profits are well-supported by actual cash generation, not accounting adjustments.

Interest Coverage Safe

6.0x

Honeywell Intl Inc earns $6.0 in operating income for every $1 of interest expense ($8.1B vs $1.3B). This wide margin provides strong safety for debt servicing, even if earnings decline temporarily.

Key Financial Metrics

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Earnings & Revenue

Revenue

$37.4B

YoY+7.8%

5Y CAGR+2.8%

10Y CAGR-0.3%

Honeywell Intl Inc generated $37.4B in revenue in fiscal year 2025. This represents an increase of 7.8% from the prior year.

EBITDA

$9.5B

YoY+7.9%

Honeywell Intl Inc's EBITDA was $9.5B in fiscal year 2025, measuring earnings before interest, taxes, depreciation, and amortization. This represents an increase of 7.9% from the prior year.

Net Income

$4.7B

YoY-17.1%

5Y CAGR-0.2%

10Y CAGR-0.1%

Honeywell Intl Inc reported $4.7B in net income in fiscal year 2025. This represents a decrease of 17.1% from the prior year.

EPS (Diluted)

$7.36

YoY-15.5%

5Y CAGR+1.8%

10Y CAGR+2.0%

Honeywell Intl Inc earned $7.36 per diluted share (EPS) in fiscal year 2025. This represents a decrease of 15.5% from the prior year.

Cash & Balance Sheet

Free Cash Flow

$5.4B

YoY+3.8%

5Y CAGR+0.4%

10Y CAGR+2.0%

Honeywell Intl Inc generated $5.4B in free cash flow in fiscal year 2025, representing cash available after capex. This represents an increase of 3.8% from the prior year.

Cash & Debt

$12.5B

YoY+26.1%

5Y CAGR-2.6%

10Y CAGR+8.6%

Honeywell Intl Inc held $12.5B in cash against $27.1B in long-term debt as of fiscal year 2025.

Dividends Per Share

$4.58

YoY+4.8%

5Y CAGR+4.8%

10Y CAGR+7.9%

Honeywell Intl Inc paid $4.58 per share in dividends in fiscal year 2025. This represents an increase of 4.8% from the prior year.

Shares Outstanding

636M

YoY-2.2%

5Y CAGR-1.8%

10Y CAGR-1.9%

Honeywell Intl Inc had 636M shares outstanding in fiscal year 2025. This represents a decrease of 2.2% from the prior year.

Margins & Returns

Gross Margin

36.9%

YoY-1.5pp

5Y CAGR+4.9pp

10Y CAGR+6.3pp

Honeywell Intl Inc's gross margin was 36.9% in fiscal year 2025, indicating the percentage of revenue retained after direct costs. This is down 1.5 percentage points from the prior year.

Operating Margin

21.7%

YoY-0.4pp

Honeywell Intl Inc's operating margin was 21.7% in fiscal year 2025, reflecting core business profitability. This is down 0.4 percentage points from the prior year.

Net Margin

12.6%

YoY-3.8pp

5Y CAGR-2.0pp

10Y CAGR+0.3pp

Honeywell Intl Inc's net profit margin was 12.6% in fiscal year 2025, showing the share of revenue converted to profit. This is down 3.8 percentage points from the prior year.

Return on Equity

34.0%

YoY+3.4pp

5Y CAGR+6.8pp

10Y CAGR+7.9pp

Honeywell Intl Inc's ROE was 34.0% in fiscal year 2025, measuring profit generated per dollar of shareholder equity. This is up 3.4 percentage points from the prior year.

Capital Allocation

R&D Spending

$1.8B

YoY+24.6%

5Y CAGR+6.3%

10Y CAGR-0.2%

Honeywell Intl Inc invested $1.8B in research and development in fiscal year 2025. This represents an increase of 24.6% from the prior year.

Share Buybacks

$3.8B

YoY+129.8%

5Y CAGR+0.5%

10Y CAGR+7.3%

Honeywell Intl Inc spent $3.8B on share buybacks in fiscal year 2025, returning capital to shareholders by reducing shares outstanding. This represents an increase of 129.8% from the prior year.

Capital Expenditures

$986.0M

YoY+13.2%

5Y CAGR+1.7%

10Y CAGR-0.8%

Honeywell Intl Inc invested $986.0M in capex in fiscal year 2025, funding long-term assets and infrastructure. This represents an increase of 13.2% from the prior year.

HONIV Income Statement

Metric	FY25	FY24	FY23	FY22	FY21	FY20
Revenue	$37.4B+7.8%	$34.7B+5.2%	$33.0B-6.9%	$35.5B+3.1%	$34.4B+5.4%	$32.6B
Cost of Revenue	$23.6B+10.5%	$21.4B+3.5%	$20.6B-7.7%	$22.3B+1.3%	$22.1B-0.5%	$22.2B
Gross Profit	$13.8B+3.5%	$13.4B+8.0%	$12.4B-5.7%	$13.1B+6.4%	$12.3B+17.8%	$10.5B
R&D Expenses	$1.8B+24.6%	$1.5B+5.7%	$1.4B-7.0%	$1.5B+10.9%	$1.3B-0.1%	$1.3B
SG&A Expenses	$5.5B+4.1%	$5.2B+7.1%	$4.9B-6.3%	$5.2B+8.7%	$4.8B+0.5%	$4.8B
Operating Income	$8.1B+6.0%	$7.7B+1.4%	$7.6B-5.7%	$8.0B	N/A	N/A
Interest Expense	$1.3B+28.2%	$1.0B+39.9%	$749.0M+80.9%	$414.0M+20.7%	$343.0M-4.5%	$359.0M
Income Tax	$1.0B-19.3%	$1.2B-1.0%	$1.3B-10.6%	$1.4B-13.1%	$1.6B+41.7%	$1.1B
Net Income	$4.7B-17.1%	$5.7B+0.8%	$5.7B+13.9%	$5.0B-10.4%	$5.5B+16.0%	$4.8B
EPS (Diluted)	$7.36-15.5%	$8.71+2.8%	$8.47+16.5%	$7.27-8.1%	$7.91+17.7%	$6.72

Metric	Q1'26	Q4'25	Q3'25	Q2'25	Q1'25	Q4'24	Q3'24	Q2'24
Revenue	$9.1B-6.3%	$9.8B+3.4%	$9.4B+1.2%	$9.3B+4.4%	$8.9B-2.7%	$9.2B+4.0%	$8.8B+2.9%	$8.6B
Cost of Revenue	$5.6B	N/A	$6.9B+8.4%	$6.3B+15.9%	$5.5B	N/A	$6.0B+2.1%	$5.9B
Gross Profit	$3.5B+2.0%	$3.5B+7.3%	$3.2B-11.8%	$3.7B+5.8%	$3.5B+2.9%	$3.4B-1.6%	$3.4B+2.0%	$3.4B
R&D Expenses	$492.0M	N/A	$497.0M+3.3%	$481.0M+15.6%	$416.0M	N/A	$368.0M-3.7%	$382.0M
SG&A Expenses	$1.3B	N/A	$1.3B-9.2%	$1.4B+9.0%	$1.3B	N/A	$1.4B+2.7%	$1.4B
Operating Income	$2.1B	N/A	$2.4B+1.7%	$2.4B+18.2%	$2.0B	N/A	$2.3B+4.4%	$2.2B
Interest Expense	$356.0M	N/A	$354.0M+7.3%	$330.0M+15.8%	$285.0M	N/A	$297.0M+18.8%	$250.0M
Income Tax	$91.0M	N/A	$363.0M+20.2%	$302.0M-18.2%	$369.0M	N/A	$409.0M-1.2%	$414.0M
Net Income	$821.0M+813.9%	-$115.0M-106.3%	$1.8B+16.2%	$1.6B+8.4%	$1.4B+12.8%	$1.3B-9.1%	$1.4B-8.5%	$1.5B
EPS (Diluted)	$1.29+816.7%	$-0.18-106.3%	$2.86+16.7%	$2.45+10.4%	$2.22+13.3%	$1.96-9.3%	$2.16-8.5%	$2.36

HONIV Balance Sheet

Metric	FY25	FY24	FY23	FY22	FY21	FY20
Total Assets	$73.7B-2.0%	$75.2B+22.2%	$61.5B-1.2%	$62.3B-3.4%	$64.5B-0.2%	$64.6B
Current Assets	$30.4B+8.9%	$27.9B+18.7%	$23.5B-5.9%	$25.0B-1.5%	$25.4B-9.9%	$28.2B
Cash & Equivalents	$12.5B+26.1%	$9.9B+25.0%	$7.9B-17.7%	$9.6B-12.2%	$11.0B-23.2%	$14.3B
Inventory	$6.2B+4.7%	$5.9B-4.8%	$6.2B+11.6%	$5.5B+7.8%	$5.1B+14.5%	$4.5B
Accounts Receivable	$7.6B+5.2%	$7.2B-3.8%	$7.5B+1.2%	$7.4B+8.9%	$6.8B0.0%	$6.8B
Goodwill	$21.1B+0.3%	$21.0B+21.9%	$17.2B-1.5%	$17.5B-1.5%	$17.8B+10.6%	$16.1B
Total Liabilities	$59.8B+5.7%	$56.6B+23.9%	$45.7B+0.2%	$45.6B-0.7%	$45.9B-2.4%	$47.0B
Current Liabilities	$23.4B+10.2%	$21.3B+14.7%	$18.5B-7.0%	$19.9B+2.2%	$19.5B+1.6%	$19.2B
Long-Term Debt	$27.1B+6.7%	$25.4B+38.6%	$18.4B+8.9%	$16.9B+5.0%	$16.1B-14.5%	$18.8B
Total Equity	$13.9B-25.3%	$18.6B+17.4%	$15.9B-5.0%	$16.7B-10.1%	$18.6B+5.8%	$17.5B
Retained Earnings	$51.0B+0.3%	$50.8B+6.0%	$48.0B+6.4%	$45.1B+5.3%	$42.8B+7.3%	$39.9B

Metric	Q1'26	Q4'25	Q3'25	Q2'25	Q1'25	Q4'24	Q3'24	Q2'24
Total Assets	$74.0B+0.4%	$73.7B-8.9%	$80.9B+3.2%	$78.4B+4.3%	$75.2B0.0%	$75.2B+2.3%	$73.5B+6.0%	$69.3B
Current Assets	$30.6B+0.7%	$30.4B-1.2%	$30.7B+9.9%	$28.0B+1.2%	$27.6B-0.9%	$27.9B-0.9%	$28.2B+11.0%	$25.4B
Cash & Equivalents	$12.0B-4.1%	$12.5B-3.4%	$12.9B+24.9%	$10.3B+7.2%	$9.7B-2.5%	$9.9B-6.9%	$10.6B+11.2%	$9.6B
Inventory	$6.4B+3.4%	$6.2B-13.4%	$7.1B+1.5%	$7.0B+6.1%	$6.6B+12.4%	$5.9B-7.2%	$6.3B+0.2%	$6.3B
Accounts Receivable	$8.1B+5.8%	$7.6B-14.6%	$8.9B+1.1%	$8.8B+6.9%	$8.3B+13.9%	$7.2B-8.1%	$7.9B+1.6%	$7.8B
Goodwill	$21.1B0.0%	$21.1B-11.1%	$23.7B-0.4%	$23.8B+8.1%	$22.0B+4.8%	$21.0B-1.2%	$21.3B+2.1%	$20.8B
Total Liabilities	$60.4B+1.0%	$59.8B-6.8%	$64.1B+2.9%	$62.3B+7.9%	$57.8B+2.1%	$56.6B+0.9%	$56.1B+7.1%	$52.4B
Current Liabilities	$22.1B-5.7%	$23.4B+3.4%	$22.6B+4.7%	$21.6B-2.0%	$22.1B+3.8%	$21.3B+8.8%	$19.5B-7.2%	$21.0B
Long-Term Debt	$29.0B+6.9%	$27.1B-9.8%	$30.1B-0.2%	$30.2B+17.2%	$25.7B+1.2%	$25.4B-1.9%	$25.9B+24.3%	$20.9B
Total Equity	$13.6B-2.3%	$13.9B-17.1%	$16.8B+4.3%	$16.1B-7.8%	$17.5B-6.2%	$18.6B+7.0%	$17.4B+2.7%	$16.9B
Retained Earnings	$51.0B+0.1%	$51.0B-4.7%	$53.5B+2.1%	$52.4B+1.6%	$51.5B+1.4%	$50.8B+1.1%	$50.3B+1.4%	$49.6B

HONIV Cash Flow Statement

Metric	FY25	FY24	FY23	FY22	FY21	FY20
Operating Cash Flow	$6.4B+5.1%	$6.1B+14.2%	$5.3B+1.3%	$5.3B-12.7%	$6.0B-2.7%	$6.2B
Capital Expenditures	$986.0M+13.2%	$871.0M+17.5%	$741.0M-3.3%	$766.0M-14.4%	$895.0M-1.2%	$906.0M
Free Cash Flow	$5.4B+3.8%	$5.2B+13.6%	$4.6B+2.0%	$4.5B-12.3%	$5.1B-3.0%	$5.3B
Investing Cash Flow	-$2.7B+73.3%	-$10.2B-685.5%	-$1.3B-1290.3%	-$93.0M+91.2%	-$1.1B-7.5%	-$987.0M
Financing Cash Flow	-$2.0B-128.6%	$6.8B+218.7%	-$5.8B+9.0%	-$6.3B+23.3%	-$8.3B-10090.1%	-$81.0M
Dividends Paid	$3.0B+2.5%	$2.9B+1.6%	$2.9B+5.0%	$2.7B+3.5%	$2.6B+1.3%	$2.6B
Share Buybacks	$3.8B+129.8%	$1.7B-55.5%	$3.7B-11.5%	$4.2B+24.3%	$3.4B-9.0%	$3.7B

Metric	Q1'26	Q4'25	Q3'25	Q2'25	Q1'25	Q4'24	Q3'24	Q2'24
Operating Cash Flow	-$650.0M-154.0%	$1.2B-63.4%	$3.3B+149.3%	$1.3B+120.9%	$597.0M-73.8%	$2.3B+14.2%	$2.0B+45.7%	$1.4B
Capital Expenditures	$223.0M+284.5%	$58.0M-84.5%	$374.0M+2.7%	$364.0M+91.6%	$190.0M+90.0%	$100.0M-64.2%	$279.0M+7.7%	$259.0M
Free Cash Flow	-$873.0M-176.2%	$1.1B-60.7%	$2.9B+205.1%	$955.0M+134.6%	$407.0M-81.3%	$2.2B+26.9%	$1.7B+54.5%	$1.1B
Investing Cash Flow	-$119.0M+65.3%	-$343.0M+29.7%	-$488.0M+67.7%	-$1.5B-306.7%	-$371.0M+81.0%	-$2.0B+30.1%	-$2.8B+45.5%	-$5.1B
Financing Cash Flow	$267.0M+120.3%	-$1.3B-499.5%	-$219.0M-128.9%	$759.0M+164.3%	-$1.2B-438.8%	-$219.0M-112.4%	$1.8B+9.9%	$1.6B
Dividends Paid	$781.0M+2.5%	$762.0M+3.7%	$735.0M-1.6%	$747.0M+2.0%	$732.0M-1.2%	$741.0M+3.6%	$715.0M-3.8%	$743.0M
Share Buybacks	$1.0B+900.0%	$100.0M0.0%	$100.0M-94.1%	$1.7B-10.5%	$1.9B+318.0%	$455.0M	$0-100.0%	$529.0M

HONIV Financial Ratios

Metric	FY25	FY24	FY23	FY22	FY21	FY20
Gross Margin	36.9%-1.5pp	38.5%+1.0pp	37.5%+0.5pp	37.0%+1.1pp	35.9%+3.8pp	32.1%
Operating Margin	21.7%-0.4pp	22.1%-0.8pp	22.9%+0.3pp	22.6%	N/A	N/A
Net Margin	12.6%-3.8pp	16.4%-0.7pp	17.1%+3.1pp	14.0%-2.1pp	16.1%+1.5pp	14.6%
Return on Equity	34.0%+3.4pp	30.6%-5.0pp	35.7%+5.9pp	29.7%-0.1pp	29.8%+2.6pp	27.2%
Return on Assets	6.4%-1.2pp	7.6%-1.6pp	9.2%+1.2pp	8.0%-0.6pp	8.6%+1.2pp	7.4%
Current Ratio	1.30-0.0	1.31+0.0	1.27+0.0	1.25-0.0	1.30-0.2	1.47
Debt-to-Equity	2.06+0.6	1.44+0.3	1.16+0.1	1.01+0.1	0.86-0.2	1.07
FCF Margin	14.5%-0.6pp	15.0%+1.1pp	13.9%+1.2pp	12.7%-2.2pp	14.9%-1.3pp	16.3%

Metric	Q1'26	Q4'25	Q3'25	Q2'25	Q1'25	Q4'24	Q3'24	Q2'24
Gross Margin	38.7%+3.1pp	35.6%+1.3pp	34.3%-5.0pp	39.3%+0.5pp	38.8%+2.1pp	36.7%-2.1pp	38.8%-0.3pp	39.1%
Operating Margin	23.3%	N/A	25.5%+0.1pp	25.4%+3.0pp	22.4%	N/A	26.0%+0.4pp	25.7%
Net Margin	9.0%+10.2pp	-1.2%-20.5pp	19.3%+2.5pp	16.8%+0.6pp	16.2%+2.2pp	14.0%-2.0pp	16.0%-2.0pp	18.0%
Return on Equity	6.0%+6.9pp	-0.8%-11.7pp	10.9%+1.1pp	9.8%+1.4pp	8.3%+1.4pp	6.9%-1.2pp	8.1%-1.0pp	9.1%
Return on Assets	1.1%+1.3pp	-0.2%-2.4pp	2.3%+0.3pp	2.0%+0.1pp	1.9%+0.2pp	1.7%-0.2pp	1.9%-0.3pp	2.2%
Current Ratio	1.39+0.1	1.30-0.1	1.36+0.1	1.29+0.0	1.25-0.1	1.31-0.1	1.44+0.2	1.21
Debt-to-Equity	2.36+0.3	2.06+0.3	1.80-0.1	1.88+0.3	1.55+0.1	1.44-0.2	1.59+0.2	1.38
FCF Margin	-9.6%-21.3pp	11.7%-19.1pp	30.9%+20.6pp	10.2%+5.7pp	4.6%-19.2pp	23.8%+4.3pp	19.5%+6.5pp	13.0%

Frequently Asked Questions

What is Honeywell Intl Inc's annual revenue?

Honeywell Intl Inc (HONIV) reported $37.4B in total revenue for fiscal year 2025. This represents a 7.8% change compared to the previous fiscal year. Revenue measures the total income earned from the company's primary business operations before any expenses are deducted.

How fast is Honeywell Intl Inc's revenue growing?

Honeywell Intl Inc (HONIV) revenue grew by 7.8% year-over-year, from $34.7B to $37.4B in fiscal year 2025.

Is Honeywell Intl Inc profitable?

Yes, Honeywell Intl Inc (HONIV) reported a net income of $4.7B in fiscal year 2025, with a net profit margin of 12.6%.

What is Honeywell Intl Inc's EBITDA?

Honeywell Intl Inc (HONIV) had EBITDA of $9.5B in fiscal year 2025, measuring earnings before interest, taxes, depreciation, and amortization.

How much debt does Honeywell Intl Inc have?

As of fiscal year 2025, Honeywell Intl Inc (HONIV) had $12.5B in cash and equivalents against $27.1B in long-term debt.

What is Honeywell Intl Inc's gross margin?

Honeywell Intl Inc (HONIV) had a gross margin of 36.9% in fiscal year 2025, indicating the percentage of revenue retained after direct costs of goods sold.

What is Honeywell Intl Inc's operating margin?

Honeywell Intl Inc (HONIV) had an operating margin of 21.7% in fiscal year 2025, reflecting the profitability of core business operations before interest and taxes.

What is Honeywell Intl Inc's net profit margin?

Honeywell Intl Inc (HONIV) had a net profit margin of 12.6% in fiscal year 2025, representing the share of revenue converted into profit after all expenses.

Does Honeywell Intl Inc pay dividends?

Yes, Honeywell Intl Inc (HONIV) paid $4.58 per share in dividends during fiscal year 2025.

What is Honeywell Intl Inc's return on equity (ROE)?

Honeywell Intl Inc (HONIV) has a return on equity of 34.0% for fiscal year 2025, measuring how efficiently the company generates profit from shareholder equity.

What is Honeywell Intl Inc's free cash flow?

Honeywell Intl Inc (HONIV) generated $5.4B in free cash flow during fiscal year 2025. This represents a 3.8% change compared to the previous fiscal year. Free cash flow represents the cash a company generates after accounting for capital expenditures, and is widely used to assess financial flexibility and shareholder value.

What is Honeywell Intl Inc's operating cash flow?

Honeywell Intl Inc (HONIV) generated $6.4B in operating cash flow during fiscal year 2025, representing cash generated from core business activities.

What are Honeywell Intl Inc's total assets?

Honeywell Intl Inc (HONIV) had $73.7B in total assets as of fiscal year 2025, including both current and long-term assets.

What are Honeywell Intl Inc's capital expenditures?

Honeywell Intl Inc (HONIV) invested $986.0M in capital expenditures during fiscal year 2025, funding long-term assets and infrastructure.

How much does Honeywell Intl Inc spend on research and development?

Honeywell Intl Inc (HONIV) invested $1.8B in research and development during fiscal year 2025.

Does Honeywell Intl Inc buy back shares?

Yes, Honeywell Intl Inc (HONIV) spent $3.8B on share buybacks during fiscal year 2025, returning capital to shareholders by reducing shares outstanding.

How many shares does Honeywell Intl Inc have outstanding?

Honeywell Intl Inc (HONIV) had 636M shares outstanding as of fiscal year 2025.

What is Honeywell Intl Inc's current ratio?

Honeywell Intl Inc (HONIV) had a current ratio of 1.30 as of fiscal year 2025, which is considered adequate.

What is Honeywell Intl Inc's debt-to-equity ratio?

Honeywell Intl Inc (HONIV) had a debt-to-equity ratio of 2.06 as of fiscal year 2025, measuring the company's financial leverage by comparing total debt to shareholder equity.

What is Honeywell Intl Inc's return on assets (ROA)?

Honeywell Intl Inc (HONIV) had a return on assets of 6.4% for fiscal year 2025, measuring how efficiently the company uses its assets to generate profit.

What is Honeywell Intl Inc's Piotroski F-Score?

Honeywell Intl Inc (HONIV) has a Piotroski F-Score of 5 out of 9, indicating neutral financial health. The F-Score evaluates nine binary signals across profitability (positive ROA, positive cash flow, improving ROA, earnings quality), leverage (decreasing debt, improving liquidity, no share dilution), and operating efficiency (improving gross margin, improving asset turnover). Scores of 7 to 9 indicate strong and improving fundamentals. Learn more in our complete guide to financial health indicators.

Are Honeywell Intl Inc's earnings high quality?

Honeywell Intl Inc (HONIV) has an earnings quality ratio of 1.36x, considered cash-backed (high quality). This ratio compares operating cash flow to net income. A ratio above 1.0x means the company generates more cash than its reported earnings, indicating sustainable, cash-backed profits. Ratios below 1.0x suggest earnings rely on accounting accruals rather than actual cash generation. Learn more in our complete guide to financial health indicators.

Can Honeywell Intl Inc cover its interest payments?

Honeywell Intl Inc (HONIV) has an interest coverage ratio of 6.0x, meaning it can comfortably cover its interest obligations. This ratio divides operating income by interest expense. Ratios above 5x indicate strong debt-servicing ability, while ratios below 2x suggest the company may face difficulty meeting interest payments if earnings decline. Learn more in our complete guide to financial health indicators.