Apple Inc. stock research
FY2024 Q1
Apple (AAPL) Gross Margin — Quarter Ended Dec 30, 2023
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, while cost of revenue was lower than a year ago but higher than the previous quarter. Gross margin improved relative to both the preceding quarter and the year-ago period, reflecting a favorable relationship among the three metrics.
Gross margin takeaway
Quarter ended Dec 30, 2023 · FY2024 Q1
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, while cost of revenue was lower than a year ago but higher than the previous quarter. Gross margin improved relative to both the preceding quarter and the year-ago period, reflecting a favorable relationship among the three metrics.
- The gross margin strengthened compared to both the prior quarter and the year-ago quarter, driven by a combination of higher revenue and a lower cost of revenue relative to revenue. The most observable driver is the reduction in cost of revenue as a share of revenue.
- Compared to the immediately preceding quarter, revenue, gross profit, and gross margin were all higher, while cost of revenue was also higher. Versus the same quarter one year earlier, revenue and gross profit were higher, cost of revenue was lower, and gross margin improved.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
45.9%
Gross profit
$54.9B
Revenue
$119.6B
Cost of revenue
$64.7B
Quarter-over-quarter change
+0.7 pts
Year-over-year change
+2.9 pts
Quarterly gross margin trend
A four-quarter view of the revenue and direct-cost bridge behind gross margin.
| Period | Revenue | Gross profit | Cost of revenue | Gross margin |
|---|---|---|---|---|
| Apr 1, 2023 | $94.8B | $42.0B | $52.9B | 44.3% |
| Jul 1, 2023 | $81.8B | $36.4B | $45.4B | 44.5% |
| Sep 30, 2023 | $89.5B | $40.4B | $49.1B | 45.2% |
| Dec 30, 2023 | $119.6B | $54.9B | $64.7B | 45.9% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2023
+0.7 pts
Year-over-year change
Dec 31, 2022
+2.9 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The gross margin strengthened compared to both the prior quarter and the year-ago quarter, driven by a combination of higher revenue and a lower cost of revenue relative to revenue. The most observable driver is the reduction in cost of revenue as a share of revenue.
Compared to the immediately preceding quarter, revenue, gross profit, and gross margin were all higher, while cost of revenue was also higher. Versus the same quarter one year earlier, revenue and gross profit were higher, cost of revenue was lower, and gross margin improved.
Monitor the trajectory of cost of revenue relative to revenue, as its decline year-over-year was a key factor in the gross margin improvement.