Baxter International Inc. stock research
FY2025 Q1
Baxter International (BAX) Gross Margin — Quarter Ended Mar 31, 2025
Revenue increased from the year-ago quarter but gross profit declined, as cost of revenue grew at a faster rate, resulting in a lower gross margin. Sequentially, revenue and gross profit decreased while cost of revenue was unchanged, leading to a weaker gross margin.
Gross margin takeaway
Quarter ended Mar 31, 2025 · FY2025 Q1
Revenue increased from the year-ago quarter but gross profit declined, as cost of revenue grew at a faster rate, resulting in a lower gross margin. Sequentially, revenue and gross profit decreased while cost of revenue was unchanged, leading to a weaker gross margin.
- The largest driver of the gross margin change was the relationship between cost of revenue and revenue: cost of revenue increased more than revenue year-over-year and remained flat sequentially while revenue declined, compressing margins.
- Compared to the prior quarter, gross margin weakened as revenue fell while cost of revenue held steady. Relative to the same quarter last year, gross margin also weakened due to a higher cost of revenue that outpaced revenue growth.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
32.8%
Gross profit
$861.0M
Revenue
$2.6B
Cost of revenue
$1.8B
Quarter-over-quarter change
-5.5 pts
Year-over-year change
-5.8 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 | $2.5B | $961.0M | $1.5B | 38.6% |
| Jun 30, 2024 | $2.7B | $1.0B | $1.7B | 38.3% |
| Sep 30, 2024 | $2.7B | $1.0B | $1.7B | 38.3% |
| Mar 31, 2025 | $2.6B | $861.0M | $1.8B | 32.8% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2024
-5.5 pts
Year-over-year change
Mar 31, 2024
-5.8 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The largest driver of the gross margin change was the relationship between cost of revenue and revenue: cost of revenue increased more than revenue year-over-year and remained flat sequentially while revenue declined, compressing margins.
Compared to the prior quarter, gross margin weakened as revenue fell while cost of revenue held steady. Relative to the same quarter last year, gross margin also weakened due to a higher cost of revenue that outpaced revenue growth.
Monitor the impact of accounts payable payments related to Hurricane Helene and the timing of accounts receivable collections on future financial performance, as noted in the liquidity discussion.