CoStar Group, Inc. stock research
FY2025 Q2
CoStar Group (CSGP) Gross Margin — Quarter Ended Jun 30, 2025
Revenue and gross profit both increased compared with the immediate prior quarter and the same quarter one year earlier, while cost of revenue also rose in both comparisons. The gross margin weakened versus both periods, indicating that cost of revenue grew at a faster pace relative to revenue.
Gross margin takeaway
Quarter ended Jun 30, 2025 · FY2025 Q2
Revenue and gross profit both increased compared with the immediate prior quarter and the same quarter one year earlier, while cost of revenue also rose in both comparisons. The gross margin weakened versus both periods, indicating that cost of revenue grew at a faster pace relative to revenue.
- The strongest observable driver is the relationship between cost of revenue and revenue; cost of revenue increased at a rate that outpaced revenue growth, which directly compressed the gross margin.
- Compared with the immediately preceding quarter, gross margin was lower; compared with the same quarter one year earlier, gross margin was also lower. Revenue and gross profit were higher in both comparisons.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
78.5%
Gross profit
$613.5M
Revenue
$781.3M
Cost of revenue
$167.8M
Quarter-over-quarter change
-0.6 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 |
|---|---|---|---|---|
| Sep 30, 2024 | $692.6M | $552.0M | $140.6M | 79.7% |
| Dec 31, 2024 | $709.2M | $568.8M | $140.4M | 80.2% |
| Mar 31, 2025 | $732.0M | $579.0M | $153.0M | 79.1% |
| Jun 30, 2025 | $781.3M | $613.5M | $167.8M | 78.5% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Mar 31, 2025
-0.6 pts
Year-over-year change
Jun 30, 2024
-1.4 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable driver is the relationship between cost of revenue and revenue; cost of revenue increased at a rate that outpaced revenue growth, which directly compressed the gross margin.
Compared with the immediately preceding quarter, gross margin was lower; compared with the same quarter one year earlier, gross margin was also lower. Revenue and gross profit were higher in both comparisons.
Monitor whether the growth rate of cost of revenue continues to outpace revenue growth in future quarters.