A. O. Smith Corporation stock research
FY2026 Q1
A. O. Smith (AOS) Gross Margin — Quarter Ended Mar 31, 2026
Revenue and gross profit both increased compared to the prior quarter, while cost of revenue also rose. Gross margin improved slightly, but remained slightly below the level from the same quarter one year earlier.
Gross margin takeaway
Quarter ended Mar 31, 2026 · FY2026 Q1
Revenue and gross profit both increased compared to the prior quarter, while cost of revenue also rose. Gross margin improved slightly, but remained slightly below the level from the same quarter one year earlier.
- The gross margin improvement from the prior quarter was driven by a proportionally smaller increase in cost of revenue relative to revenue. Compared to the same quarter last year, the margin weakened as cost of revenue declined less than revenue.
- Compared to the immediately preceding quarter, revenue, gross profit, and cost of revenue were all higher, and gross margin improved. Compared to the same quarter one year earlier, revenue, gross profit, and cost of revenue were all lower, and gross margin weakened.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
38.7%
Gross profit
$365.7M
Revenue
$945.6M
Cost of revenue
$579.9M
Quarter-over-quarter change
+0.3 pts
Year-over-year change
-0.3 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, 2025 | $1.0B | $397.1M | $614.2M | 39.3% |
| Sep 30, 2025 | $942.5M | $364.5M | $578.0M | 38.7% |
| Dec 31, 2025 | $912.5M | $350.4M | $562.1M | 38.4% |
| Mar 31, 2026 | $945.6M | $365.7M | $579.9M | 38.7% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Dec 31, 2025
+0.3 pts
Year-over-year change
Mar 31, 2025
-0.3 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The gross margin improvement from the prior quarter was driven by a proportionally smaller increase in cost of revenue relative to revenue. Compared to the same quarter last year, the margin weakened as cost of revenue declined less than revenue.
Compared to the immediately preceding quarter, revenue, gross profit, and cost of revenue were all higher, and gross margin improved. Compared to the same quarter one year earlier, revenue, gross profit, and cost of revenue were all lower, and gross margin weakened.
Monitor changes in allowances for credit losses and customer rebate accruals, as these estimates affect reported revenue and may require adjustment if actual volumes or returns differ.
Peer context
Latest available gross margins for related public companies.
| Company | Gross margin |
|---|---|
| A. O. Smith Corporation (AOS) | 38.7% |