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U.S. Companies Scramble to Deal with Surging Interest Rates

Corporate treasurers in companies at all points on the credit-rating spectrum are coping with more than a year of interest rate hikes by cutting costs and paying down debt.

By Nina Trentmann & Dayana Mustak | June 16, 2023 at 12:12 PM
Photo: An Apple store in Miami, Florida, on April 12, 2022. An Apple store in Miami, Florida, on April 12, 2022.

As the Federal Reserve signals it will likely tighten the money supply further, corporate treasurers are scrambling to cope with the impact of more than a year of central bank rate hikes, taking steps like cutting costs and paying down debt.

Interest costs at U.S. companies rose by 22 percent in the first quarter of 2023, compared with a year earlier, according to a recent survey of about 1,700 businesses by Calcbench Inc., a data provider. Electronics giant Apple Inc. and telecom provider Verizon Communications Inc. are among the corporations that have seen their interest costs surge. In the case of Verizon, interest expense soared to $1.21 billion in the first quarter, from $786 million in the same period a year earlier.

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