Cardinal Health, Inc. stock research
FY2025 Q1
Cardinal Health (CAH) Gross Margin — Quarter Ended Sep 30, 2024
Revenue less cost of revenue yields gross profit, which as a percentage of revenue is gross margin. In the current quarter, gross profit remained stable while revenue declined, resulting in a higher gross margin compared to both the prior quarter and the same quarter last year.
Gross margin takeaway
Quarter ended Sep 30, 2024 · FY2025 Q1
Revenue less cost of revenue yields gross profit, which as a percentage of revenue is gross margin. In the current quarter, gross profit remained stable while revenue declined, resulting in a higher gross margin compared to both the prior quarter and the same quarter last year.
- The primary observable driver of the gross margin improvement is that gross profit remained at the same level as the prior quarter while revenue decreased, causing the margin ratio to increase.
- Compared to the immediately preceding quarter, revenue was lower, cost of revenue was lower, gross profit was unchanged, and gross margin was higher. Compared to the same quarter one year earlier, revenue was lower, cost of revenue was lower, gross profit was higher, and gross margin was higher.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
3.6%
Gross profit
$1.9B
Revenue
$52.3B
Cost of revenue
$50.4B
Quarter-over-quarter change
+0.5 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 |
|---|---|---|---|---|
| Dec 31, 2023 | $57.4B | $1.9B | $55.6B | 3.2% |
| Mar 31, 2024 | $54.9B | $1.9B | $52.9B | 3.5% |
| Jun 30, 2024 | $59.9B | $1.9B | $58.0B | 3.1% |
| Sep 30, 2024 | $52.3B | $1.9B | $50.4B | 3.6% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Jun 30, 2024
+0.5 pts
Year-over-year change
Sep 30, 2023
+0.4 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The primary observable driver of the gross margin improvement is that gross profit remained at the same level as the prior quarter while revenue decreased, causing the margin ratio to increase.
Compared to the immediately preceding quarter, revenue was lower, cost of revenue was lower, gross profit was unchanged, and gross margin was higher. Compared to the same quarter one year earlier, revenue was lower, cost of revenue was lower, gross profit was higher, and gross margin was higher.
Monitor the unwinding of negative net working capital associated with the OptumRx contracts, as noted in the filing, which impacted operating cash flow and may affect future cost of revenue.