A. O. Smith Corporation stock research
FY2024 Q1
A. O. Smith (AOS) Gross Margin — Quarter Ended Mar 31, 2024
Revenue was slightly lower than the prior quarter but higher than the same quarter last year. Gross profit and gross margin both improved compared to the prior quarter and the year-ago quarter, driven by a lower cost of revenue relative to revenue.
Gross margin takeaway
Quarter ended Mar 31, 2024 · FY2024 Q1
Revenue was slightly lower than the prior quarter but higher than the same quarter last year. Gross profit and gross margin both improved compared to the prior quarter and the year-ago quarter, driven by a lower cost of revenue relative to revenue.
- The gross margin strengthened sequentially and year-over-year, with gross profit rising while cost of revenue declined from the prior quarter. The improvement was supported by a favorable relationship between revenue and cost of revenue.
- Compared to the immediately preceding quarter, revenue was slightly lower but gross profit was higher and cost of revenue was lower, resulting in an improved gross margin. Versus the same quarter one year earlier, revenue, gross profit, and gross margin were all higher.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
39.3%
Gross profit
$384.7M
Revenue
$978.8M
Cost of revenue
$594.1M
Quarter-over-quarter change
+1.9 pts
Year-over-year change
+0.6 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 |
|---|---|---|---|---|
| Jun 30, 2023 | $960.8M | $384.7M | $576.1M | 40.0% |
| Sep 30, 2023 | $937.5M | $356.2M | $581.3M | 38.0% |
| Dec 31, 2023 | $988.1M | $369.8M | $618.3M | 37.4% |
| Mar 31, 2024 | $978.8M | $384.7M | $594.1M | 39.3% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Dec 31, 2023
+1.9 pts
Year-over-year change
Mar 31, 2023
+0.6 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The gross margin strengthened sequentially and year-over-year, with gross profit rising while cost of revenue declined from the prior quarter. The improvement was supported by a favorable relationship between revenue and cost of revenue.
Compared to the immediately preceding quarter, revenue was slightly lower but gross profit was higher and cost of revenue was lower, resulting in an improved gross margin. Versus the same quarter one year earlier, revenue, gross profit, and gross margin were all higher.
Monitor the allowance for credit losses, which increased from the prior quarter end, as it may affect future revenue recognition.