A. O. Smith Corporation stock research
FY2024 Q3
A. O. Smith (AOS) Gross Margin — Quarter Ended Sep 30, 2024
Revenue and gross profit both decreased compared to the previous quarter and the same quarter last year, while cost of revenue also declined. Gross margin weakened versus both prior periods, reflecting a lower proportion of revenue retained as gross profit.
Gross margin takeaway
Quarter ended Sep 30, 2024 · FY2024 Q3
Revenue and gross profit both decreased compared to the previous quarter and the same quarter last year, while cost of revenue also declined. Gross margin weakened versus both prior periods, reflecting a lower proportion of revenue retained as gross profit.
- Gross margin was primarily influenced by the relationship between revenue and cost of revenue; revenue fell more sharply than cost of revenue relative to both the prior quarter and the year-ago quarter, compressing the margin.
- Compared to the immediately preceding quarter, revenue, gross profit, and gross margin all declined. Versus the same quarter one year earlier, all three metrics were also lower, with gross margin showing a more pronounced weakening.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
37.4%
Gross profit
$337.3M
Revenue
$902.6M
Cost of revenue
$565.3M
Quarter-over-quarter change
-1.3 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 |
|---|---|---|---|---|
| Dec 31, 2023 | $988.1M | $369.8M | $618.3M | 37.4% |
| Mar 31, 2024 | $978.8M | $384.7M | $594.1M | 39.3% |
| Jun 30, 2024 | $1.0B | $396.0M | $628.3M | 38.7% |
| Sep 30, 2024 | $902.6M | $337.3M | $565.3M | 37.4% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Jun 30, 2024
-1.3 pts
Year-over-year change
Sep 30, 2023
-0.6 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
Gross margin was primarily influenced by the relationship between revenue and cost of revenue; revenue fell more sharply than cost of revenue relative to both the prior quarter and the year-ago quarter, compressing the margin.
Compared to the immediately preceding quarter, revenue, gross profit, and gross margin all declined. Versus the same quarter one year earlier, all three metrics were also lower, with gross margin showing a more pronounced weakening.
Monitor the allowance for credit losses, which increased from the prior year-end and reflects the company's estimate of expected credit losses over the life of receivables.