CoStar Group, Inc. stock research
FY2023 Q4
CoStar Group (CSGP) Gross Margin — Quarter Ended Dec 31, 2023
Revenue and gross profit both increased from the prior quarter and the same quarter a year ago. However, gross margin weakened as cost of revenue grew at a faster pace than revenue.
Gross margin takeaway
Quarter ended Dec 31, 2023 · FY2023 Q4
Revenue and gross profit both increased from the prior quarter and the same quarter a year ago. However, gross margin weakened as cost of revenue grew at a faster pace than revenue.
- The strongest observable margin driver was the rise in cost of revenue relative to revenue, which outpaced revenue growth and compressed the gross margin.
- Compared to the immediately preceding quarter, gross margin was lower; compared to the same quarter one year earlier, gross margin was also lower.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
78.8%
Gross profit
$504.3M
Revenue
$640.1M
Cost of revenue
$135.8M
Quarter-over-quarter change
-1.4 pts
Year-over-year change
-2.2 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 | $584.4M | $465.2M | $119.2M | 79.6% |
| Jun 30, 2023 | $605.9M | $493.5M | $112.4M | 81.4% |
| Sep 30, 2023 | $624.7M | $501.0M | $123.7M | 80.2% |
| Dec 31, 2023 | $640.1M | $504.3M | $135.8M | 78.8% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2023
-1.4 pts
Year-over-year change
Dec 31, 2022
-2.2 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver was the rise in cost of revenue relative to revenue, which outpaced revenue growth and compressed the gross margin.
Compared to the immediately preceding quarter, gross margin was lower; compared to the same quarter one year earlier, gross margin was also lower.
Monitor the trend in cost of revenue growth relative to revenue growth, as the company's contractual purchase obligations and lease commitments, as noted in the filing, may influence future cost levels.