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Net Debt

Categories: Accounting, Credit

See: Net Borrower. It's the same thing.

If a company has cash and debt, you'd come up with their net figure, subtracting one from the other. Like...whatever.com might have this enormous $5.3 billion in debt. But if they have $5 billion in cash, then they have "only" $300 million in debt. That 300 is their net debt position.

And it's a Thing because, presumably, in a pinch, they could just use their cash to quickly pay off whatever debt was owed and be left with that smaller net amount to worry about.

Find other enlightening terms in Shmoop Finance Genius Bar(f)