Dollar General Corporation stock research
FY2023 Q4
Dollar General (DG) Gross Margin — Quarter Ended Feb 2, 2024
Revenue, gross profit, and cost of revenue all decreased compared to both the previous quarter and the same quarter one year earlier. Gross margin improved slightly from the prior quarter but weakened from the year-ago period as the decline in gross profit outpaced the decline in revenue.
Gross margin takeaway
Quarter ended Feb 2, 2024 · FY2023 Q4
Revenue, gross profit, and cost of revenue all decreased compared to both the previous quarter and the same quarter one year earlier. Gross margin improved slightly from the prior quarter but weakened from the year-ago period as the decline in gross profit outpaced the decline in revenue.
- The strongest observable driver is the relationship between cost of revenue and revenue. In the current quarter, the decline in cost of revenue was proportionally smaller than the decline in revenue compared to the year-ago quarter, which weakened gross margin.
- Compared to the previous quarter, gross margin was higher as cost of revenue decreased at a slightly faster rate than revenue. Compared to the same quarter one year earlier, gross margin was lower, reflecting a greater decline in gross profit relative to revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
29.5%
Gross profit
$2.9B
Revenue
$9.9B
Cost of revenue
$7.0B
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 |
|---|---|---|---|---|
| May 5, 2023 | $9.3B | $3.0B | $6.4B | 31.6% |
| Aug 4, 2023 | $9.8B | $3.0B | $6.8B | 31.1% |
| Nov 3, 2023 | $9.7B | $2.8B | $6.9B | 29.0% |
| Feb 2, 2024 | $9.9B | $2.9B | $7.0B | 29.5% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Nov 3, 2023
+0.5 pts
Year-over-year change
Feb 3, 2023
-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. In the current quarter, the decline in cost of revenue was proportionally smaller than the decline in revenue compared to the year-ago quarter, which weakened gross margin.
Compared to the previous quarter, gross margin was higher as cost of revenue decreased at a slightly faster rate than revenue. Compared to the same quarter one year earlier, gross margin was lower, reflecting a greater decline in gross profit relative to revenue.
Monitor the trajectory of cost of revenue relative to revenue, as the year-over-year compression in gross margin suggests cost reductions may not fully match revenue declines.