Salesforce, Inc. stock research
FY2024 Q2
Salesforce (CRM) Gross Margin — Quarter Ended Jul 31, 2023
Revenue increased while cost of revenue remained stable, leading to higher gross profit and an improved gross margin. The margin improvement was driven entirely by revenue growth as cost of revenue did not change.
Gross margin takeaway
Quarter ended Jul 31, 2023 · FY2024 Q2
Revenue increased while cost of revenue remained stable, leading to higher gross profit and an improved gross margin. The margin improvement was driven entirely by revenue growth as cost of revenue did not change.
- The strongest driver of the margin improvement was the stability of cost of revenue, which did not increase despite higher revenue. This allowed revenue growth to flow directly into gross profit.
- Compared to the preceding quarter, gross margin improved as revenue grew while cost of revenue remained unchanged. Compared to the same quarter one year earlier, gross margin also improved, with revenue higher and cost of revenue stable.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
75.4%
Gross profit
$6.5B
Revenue
$8.6B
Cost of revenue
$2.1B
Quarter-over-quarter change
+1.2 pts
Year-over-year change
+3.0 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 |
|---|---|---|---|---|
| Oct 31, 2022 | $7.8B | $5.7B | $2.1B | 73.4% |
| Jan 31, 2023 | $8.4B | $6.3B | $2.1B | 75.0% |
| Apr 30, 2023 | $8.2B | $6.1B | $2.1B | 74.2% |
| Jul 31, 2023 | $8.6B | $6.5B | $2.1B | 75.4% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Apr 30, 2023
+1.2 pts
Year-over-year change
Jul 31, 2022
+3.0 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest driver of the margin improvement was the stability of cost of revenue, which did not increase despite higher revenue. This allowed revenue growth to flow directly into gross profit.
Compared to the preceding quarter, gross margin improved as revenue grew while cost of revenue remained unchanged. Compared to the same quarter one year earlier, gross margin also improved, with revenue higher and cost of revenue stable.
Monitor whether cost of revenue remains stable as revenue continues to grow, as any increase in cost without proportional revenue growth could pressure margins.