Tools · Calculator
Debt-to-equity and interest coverage calculator
Divide long-term debt by shareholders' equity, and operating income by interest expense, or load both pairs from a covered company's 10-K.
An illustration, not a credit opinion. This calculator divides debt by equity and operating income by interest expense. It doesn't say whether any ratio is high, low or safe, and it doesn't predict anything.
The formulas
Debt-to-equity = long-term debt ÷ shareholders' equity
Interest coverage = operating income ÷ interest expense
A worked example: Microsoft
At the end of fiscal 2026, Microsoft had long-term debt of $31.1B and shareholders' equity of $442.4B, a debt-to-equity ratio of about 0.07. Operating income of $155.2B and interest expense of $3.1B mean the interest bill was covered about 50.9 times.
Source: Microsoft 10-K for fiscal 2026, filed Jul 29, 2026
Reading the result
Debt-to-equity explains why the ratio varies so much by industry and why banks are left out. Interest coverage covers the income-statement view of the same question.
Common questions
How do you calculate debt-to-equity?
Divide debt by shareholders' equity, both from the balance sheet. Microsoft's long-term debt of $31.1B and equity of $442.4B give a ratio of about 0.07. Source: Microsoft 10-K for fiscal 2026.
How do you calculate interest coverage?
Divide operating income by interest expense. Microsoft's fiscal 2026 operating income of $155.2B and interest expense of $3.1B mean operating income covered the interest bill about 50.9 times. Source: Microsoft 10-K for fiscal 2026.
Why does debt-to-equity show n/m?
When shareholders' equity is zero or negative the ratio isn't meaningful, so the calculator shows n/m. That can follow years of buybacks and dividends larger than retained profits.
Why does interest coverage show n/m?
When interest expense is zero or negative there is no interest bill to divide by, so a coverage ratio isn't meaningful.
Should leases count as debt?
Some versions of debt-to-equity add lease obligations, since leases are a fixed commitment much like debt. The figures here use long-term debt only, the same as the explainer.
Disclosures
- Editor holdings
- The editor holds shares of Tesla (TSLA) and SpaceX in a long-term retirement account. The editor holds no position in any other company named on this page. As of Nov 11, 2026.
- Compensation
- Nobody paid for this calculator. No affiliate links on this calculator.
- Sources
- Each company's own SEC filings, linked next to each number.
- Last updated
- Nov 10, 2026
General education, the same for every reader. Not a recommendation to buy, sell or hold any security, and it doesn't consider your situation.
More in Learn and Tools · Methodology & Disclosures explains where every number comes from.