CVS Health Corporation stock research
FY2023 Q2
CVS Health (CVS) Gross Margin — Quarter Ended Jun 30, 2023
Revenue, gross profit, and cost of revenue all increased compared to the prior quarter and the same quarter last year. Gross margin improved slightly from the prior quarter and more notably from a year ago.
Gross margin takeaway
Quarter ended Jun 30, 2023 · FY2023 Q2
Revenue, gross profit, and cost of revenue all increased compared to the prior quarter and the same quarter last year. Gross margin improved slightly from the prior quarter and more notably from a year ago.
- The strongest observable driver of the gross margin improvement was revenue growth across all segments, as noted in the management discussion. This growth outpaced the increase in cost of revenue, leading to a higher margin.
- Compared to the prior quarter, gross margin was slightly higher as revenue and cost of revenue both increased, with revenue growing at a faster pace. Year-over-year, gross margin improved more significantly, supported by stronger revenue growth relative to cost of revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
39.8%
Gross profit
$35.4B
Revenue
$88.9B
Cost of revenue
$53.5B
Quarter-over-quarter change
+0.1 pts
Year-over-year change
+0.9 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 | $85.3B | $33.8B | $51.5B | 39.7% |
| Jun 30, 2023 | $88.9B | $35.4B | $53.5B | 39.8% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Mar 31, 2023
+0.1 pts
Year-over-year change
Jun 30, 2022
+0.9 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable driver of the gross margin improvement was revenue growth across all segments, as noted in the management discussion. This growth outpaced the increase in cost of revenue, leading to a higher margin.
Compared to the prior quarter, gross margin was slightly higher as revenue and cost of revenue both increased, with revenue growing at a faster pace. Year-over-year, gross margin improved more significantly, supported by stronger revenue growth relative to cost of revenue.
Monitor the trend in cost of revenue relative to revenue, as the margin improvement depends on this relationship.