Air Products and Chemicals, Inc. stock research
FY2023 Q3
Air Products and Chemicals (APD) Gross Margin — Quarter Ended Jun 30, 2023
Revenue was lower than the prior quarter and the year-ago quarter, while gross profit was higher than both periods. This was driven by a proportionally larger decline in cost of revenue, leading to an improved gross margin.
Gross margin takeaway
Quarter ended Jun 30, 2023 · FY2023 Q3
Revenue was lower than the prior quarter and the year-ago quarter, while gross profit was higher than both periods. This was driven by a proportionally larger decline in cost of revenue, leading to an improved gross margin.
- The primary observable driver of margin improvement was the reduction in cost of revenue relative to revenue, as cost of revenue declined more steeply than revenue declined.
- Gross margin strengthened compared with the immediately preceding quarter and improved compared with the same quarter one year earlier. Revenue was lower in both comparisons, but gross profit was higher.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
31.7%
Gross profit
$963.2M
Revenue
$3.0B
Cost of revenue
$2.1B
Quarter-over-quarter change
+3.1 pts
Year-over-year change
+5.2 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, 2023 | $3.2B | $917.3M | $2.3B | 28.7% |
| Jun 30, 2023 | $3.0B | $963.2M | $2.1B | 31.7% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Mar 31, 2023
+3.1 pts
Year-over-year change
Jun 30, 2022
+5.2 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The primary observable driver of margin improvement was the reduction in cost of revenue relative to revenue, as cost of revenue declined more steeply than revenue declined.
Gross margin strengthened compared with the immediately preceding quarter and improved compared with the same quarter one year earlier. Revenue was lower in both comparisons, but gross profit was higher.
Monitor the trajectory of cost of revenue, as its decline relative to revenue was the key factor in the margin expansion.