A. O. Smith Corporation stock research
FY2025 Q4
A. O. Smith (AOS) Gross Margin — Quarter Ended Dec 31, 2024
Revenue and gross profit both increased slightly from the prior quarter, while cost of revenue rose at a similar pace, resulting in a marginally lower gross margin. Compared with the same quarter a year ago, revenue, gross profit, and cost of revenue were all lower, and gross margin weakened slightly.
Gross margin takeaway
Quarter ended Dec 31, 2024 · FY2025 Q4
Revenue and gross profit both increased slightly from the prior quarter, while cost of revenue rose at a similar pace, resulting in a marginally lower gross margin. Compared with the same quarter a year ago, revenue, gross profit, and cost of revenue were all lower, and gross margin weakened slightly.
- The gross margin was stable sequentially, with the change driven by a proportional increase in cost of revenue relative to revenue. The year-over-year decline in gross margin was accompanied by a larger proportional drop in revenue than in cost of revenue.
- Compared with the prior quarter, revenue and gross profit were slightly higher, but gross margin was marginally lower. Versus the same quarter last year, all three metrics—revenue, gross profit, and gross margin—were lower, while cost of revenue also declined.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
37.1%
Gross profit
$338.1M
Revenue
$912.4M
Cost of revenue
$574.3M
Quarter-over-quarter change
-0.3 pts
Year-over-year change
-0.4 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 |
|---|---|---|---|---|
| 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% |
| Dec 31, 2024 | $912.4M | $338.1M | $574.3M | 37.1% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2024
-0.3 pts
Year-over-year change
Dec 31, 2023
-0.4 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The gross margin was stable sequentially, with the change driven by a proportional increase in cost of revenue relative to revenue. The year-over-year decline in gross margin was accompanied by a larger proportional drop in revenue than in cost of revenue.
Compared with the prior quarter, revenue and gross profit were slightly higher, but gross margin was marginally lower. Versus the same quarter last year, all three metrics—revenue, gross profit, and gross margin—were lower, while cost of revenue also declined.
Monitor the trajectory of cost of revenue relative to revenue, as its proportional increase in the current quarter contributed to the slight gross margin compression.