Eaton Corporation plc stock research
FY2025 Q4
Eaton (ETN) Gross Margin — Quarter Ended Dec 31, 2025
Revenue increased compared to both the prior quarter and the same quarter last year. Gross profit declined sequentially but rose year-over-year, while cost of revenue grew faster, leading to a weaker gross margin.
Gross margin takeaway
Quarter ended Dec 31, 2025 · FY2025 Q4
Revenue increased compared to both the prior quarter and the same quarter last year. Gross profit declined sequentially but rose year-over-year, while cost of revenue grew faster, leading to a weaker gross margin.
- The gross margin weakened due to cost of revenue increasing at a faster rate than revenue, both sequentially and compared to the prior year.
- Compared to the prior quarter, gross margin declined; compared to the same quarter one year ago, gross margin was also lower.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
36.8%
Gross profit
$2.6B
Revenue
$7.1B
Cost of revenue
$4.5B
Quarter-over-quarter change
-1.5 pts
Year-over-year change
-2.1 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, 2025 | $6.4B | $2.4B | $3.9B | 38.4% |
| Jun 30, 2025 | $7.0B | $2.6B | $4.4B | 37.0% |
| Sep 30, 2025 | $7.0B | $2.7B | $4.3B | 38.3% |
| Dec 31, 2025 | $7.1B | $2.6B | $4.5B | 36.8% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2025
-1.5 pts
Year-over-year change
Dec 31, 2024
-2.1 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The gross margin weakened due to cost of revenue increasing at a faster rate than revenue, both sequentially and compared to the prior year.
Compared to the prior quarter, gross margin declined; compared to the same quarter one year ago, gross margin was also lower.
Monitor the trajectory of cost of revenue relative to revenue, as it has been the primary factor affecting gross margin.