CoStar Group, Inc. stock research
FY2024 Q4
CoStar Group (CSGP) Gross Margin — Quarter Ended Dec 31, 2024
Revenue and gross profit both increased compared to the prior quarter and the same quarter a year earlier, while cost of revenue was nearly unchanged quarter over quarter. Gross margin improved relative to both the preceding quarter and the year-ago quarter, reflecting the relationship between higher revenue and a relatively stable cost base.
Gross margin takeaway
Quarter ended Dec 31, 2024 · FY2024 Q4
Revenue and gross profit both increased compared to the prior quarter and the same quarter a year earlier, while cost of revenue was nearly unchanged quarter over quarter. Gross margin improved relative to both the preceding quarter and the year-ago quarter, reflecting the relationship between higher revenue and a relatively stable cost base.
- The primary observable driver of gross margin improvement is the combination of higher revenue with cost of revenue that remained nearly flat quarter over quarter, which expanded gross profit at a faster rate than revenue.
- Compared to the immediately preceding quarter, gross margin strengthened; compared to the same quarter one year earlier, gross margin also improved. Revenue, gross profit, and gross margin were all higher in both comparisons, while cost of revenue was slightly higher year over year but essentially unchanged sequentially.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
80.2%
Gross profit
$568.8M
Revenue
$709.2M
Cost of revenue
$140.4M
Quarter-over-quarter change
+0.5 pts
Year-over-year change
+1.4 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 |
|---|---|---|---|---|
| Mar 31, 2024 | $656.4M | $515.2M | $141.2M | 78.5% |
| Jun 30, 2024 | $677.8M | $542.0M | $135.8M | 80.0% |
| Sep 30, 2024 | $692.6M | $552.0M | $140.6M | 79.7% |
| Dec 31, 2024 | $709.2M | $568.8M | $140.4M | 80.2% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2024
+0.5 pts
Year-over-year change
Dec 31, 2023
+1.4 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The primary observable driver of gross margin improvement is the combination of higher revenue with cost of revenue that remained nearly flat quarter over quarter, which expanded gross profit at a faster rate than revenue.
Compared to the immediately preceding quarter, gross margin strengthened; compared to the same quarter one year earlier, gross margin also improved. Revenue, gross profit, and gross margin were all higher in both comparisons, while cost of revenue was slightly higher year over year but essentially unchanged sequentially.
Monitor whether cost of revenue remains stable in future quarters, as it has been a key factor supporting margin improvement in the current period.