Extra Space Storage Inc. stock research
FY2023 Q3
Extra Space Storage (EXR) Gross Margin — Quarter Ended Sep 30, 2023
Revenue increased from the prior quarter, but cost of revenue grew at a faster pace, resulting in a larger gross loss and a more negative gross margin. Compared with both the immediately preceding quarter and the same quarter one year earlier, revenue was higher while cost of revenue was also higher, leading to a weakened gross profit and a deteriorated gross margin.
Gross margin takeaway
Quarter ended Sep 30, 2023 · FY2023 Q3
Revenue increased from the prior quarter, but cost of revenue grew at a faster pace, resulting in a larger gross loss and a more negative gross margin. Compared with both the immediately preceding quarter and the same quarter one year earlier, revenue was higher while cost of revenue was also higher, leading to a weakened gross profit and a deteriorated gross margin.
- The strongest observable driver was the increase in cost of revenue, which rose faster than the increase in revenue, causing the gross loss to widen. One concrete item to monitor is the trend of cost of revenue relative to revenue.
- Compared to the prior quarter, revenue was higher but cost of revenue was also higher, resulting in a more negative gross profit and a lower gross margin. The same pattern holds when comparing with the same quarter one year earlier, as the prior-year figures were similar to the prior quarter.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
-561.0%
Gross profit
-$157.2M
Revenue
$28.0M
Cost of revenue
$185.2M
Quarter-over-quarter change
-144.7 pts
Year-over-year change
-145.9 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 | $21.4M | -$95.8M | $117.2M | -447.9% |
| Jun 30, 2023 | $22.2M | -$92.4M | $114.6M | -416.2% |
| Sep 30, 2023 | $28.0M | -$157.2M | $185.2M | -561.0% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Jun 30, 2023
-144.7 pts
Year-over-year change
Sep 30, 2022
-145.9 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable driver was the increase in cost of revenue, which rose faster than the increase in revenue, causing the gross loss to widen. One concrete item to monitor is the trend of cost of revenue relative to revenue.
Compared to the prior quarter, revenue was higher but cost of revenue was also higher, resulting in a more negative gross profit and a lower gross margin. The same pattern holds when comparing with the same quarter one year earlier, as the prior-year figures were similar to the prior quarter.
Monitor the ratio of cost of revenue to revenue, as its increase relative to revenue growth drove the margin weakening.