FactSet Research Systems Inc. stock research
FY2024 Q3
FactSet Research Systems (FDS) Gross Margin — Quarter Ended May 31, 2024
Revenue and gross profit increased both sequentially and year over year, while cost of revenue declined from the prior quarter but rose compared to the same period last year. Gross margin strengthened sequentially and also improved relative to the year-ago quarter, indicating a larger share of revenue retained after covering costs.
Gross margin takeaway
Quarter ended May 31, 2024 · FY2024 Q3
Revenue and gross profit increased both sequentially and year over year, while cost of revenue declined from the prior quarter but rose compared to the same period last year. Gross margin strengthened sequentially and also improved relative to the year-ago quarter, indicating a larger share of revenue retained after covering costs.
- The primary observable margin driver was the reduction in cost of revenue from the previous quarter, which outpaced the revenue growth and directly boosted gross margin. This change was the most significant factor in the margin expansion.
- Compared to the immediately preceding quarter, revenue and gross profit were higher and cost of revenue was lower, resulting in an improved gross margin. Versus the same quarter one year earlier, revenue and gross profit also increased, and gross margin improved despite a modest increase in cost of revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
55.3%
Gross profit
$305.7M
Revenue
$552.7M
Cost of revenue
$247.0M
Quarter-over-quarter change
+2.0 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 |
|---|---|---|---|---|
| Aug 31, 2023 | $535.8M | $272.1M | $263.7M | 50.8% |
| Nov 30, 2023 | $542.2M | $290.6M | $251.6M | 53.6% |
| Feb 29, 2024 | $545.9M | $290.8M | $255.1M | 53.3% |
| May 31, 2024 | $552.7M | $305.7M | $247.0M | 55.3% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Feb 29, 2024
+2.0 pts
Year-over-year change
May 31, 2023
+0.9 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The primary observable margin driver was the reduction in cost of revenue from the previous quarter, which outpaced the revenue growth and directly boosted gross margin. This change was the most significant factor in the margin expansion.
Compared to the immediately preceding quarter, revenue and gross profit were higher and cost of revenue was lower, resulting in an improved gross margin. Versus the same quarter one year earlier, revenue and gross profit also increased, and gross margin improved despite a modest increase in cost of revenue.
Monitor the trajectory of cost of revenue, as it decreased sequentially but increased year over year, which could influence future margin performance.