CVS Health Corporation stock research
FY2024 Q1
CVS Health (CVS) Gross Margin — Quarter Ended Mar 31, 2024
Revenue decreased from the prior quarter but increased from the same quarter last year. Gross profit rose both sequentially and year-over-year, while cost of revenue fell sequentially and declined year-over-year, resulting in a gross margin that improved compared to both periods.
Gross margin takeaway
Quarter ended Mar 31, 2024 · FY2024 Q1
Revenue decreased from the prior quarter but increased from the same quarter last year. Gross profit rose both sequentially and year-over-year, while cost of revenue fell sequentially and declined year-over-year, resulting in a gross margin that improved compared to both periods.
- The gross margin strengthened sequentially and year-over-year, driven by a larger proportion of revenue flowing through to gross profit as cost of revenue declined relative to revenue.
- Compared to the immediately preceding quarter, revenue was lower but gross profit was higher, with cost of revenue substantially lower, leading to a higher gross margin. Versus the same quarter one year earlier, revenue, gross profit, and gross margin were all higher, while cost of revenue was lower.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
45.6%
Gross profit
$40.4B
Revenue
$88.4B
Cost of revenue
$48.1B
Quarter-over-quarter change
+6.8 pts
Year-over-year change
+6.0 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 |
|---|---|---|---|---|
| Jun 30, 2023 | $88.9B | $35.4B | $53.5B | 39.8% |
| Sep 30, 2023 | $89.8B | $35.1B | $54.7B | 39.1% |
| Dec 31, 2023 | $93.8B | $36.4B | $57.4B | 38.8% |
| Mar 31, 2024 | $88.4B | $40.4B | $48.1B | 45.6% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Dec 31, 2023
+6.8 pts
Year-over-year change
Mar 31, 2023
+6.0 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The gross margin strengthened sequentially and year-over-year, driven by a larger proportion of revenue flowing through to gross profit as cost of revenue declined relative to revenue.
Compared to the immediately preceding quarter, revenue was lower but gross profit was higher, with cost of revenue substantially lower, leading to a higher gross margin. Versus the same quarter one year earlier, revenue, gross profit, and gross margin were all higher, while cost of revenue was lower.
Monitor the trajectory of cost of revenue relative to revenue, as its decline was the primary observable factor in the gross margin improvement.