FactSet Research Systems Inc. stock research
FY2025 Q3
FactSet Research Systems (FDS) Gross Margin — Quarter Ended May 31, 2025
Revenue increased from the prior quarter and from the same quarter last year. However, gross profit was slightly higher than the previous quarter but lower than a year ago, as cost of revenue grew more rapidly, leading to a decline in gross margin.
Gross margin takeaway
Quarter ended May 31, 2025 · FY2025 Q3
Revenue increased from the prior quarter and from the same quarter last year. However, gross profit was slightly higher than the previous quarter but lower than a year ago, as cost of revenue grew more rapidly, leading to a decline in gross margin.
- The primary driver of the gross margin decline is the faster growth in cost of revenue compared to revenue, both sequentially and year-over-year.
- Compared to the immediately preceding quarter, revenue and gross profit rose modestly, but the increase in cost of revenue outpaced revenue, resulting in a weaker gross margin. Relative to the same quarter one year earlier, revenue was higher and gross profit was slightly lower, while cost of revenue increased substantially, leading to a lower gross margin.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
52.1%
Gross profit
$304.8M
Revenue
$585.5M
Cost of revenue
$280.7M
Quarter-over-quarter change
-0.7 pts
Year-over-year change
-3.3 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, 2024 | $562.2M | $304.0M | $258.2M | 54.1% |
| Nov 30, 2024 | $568.7M | $309.9M | $258.8M | 54.5% |
| Feb 28, 2025 | $570.7M | $301.1M | $269.6M | 52.8% |
| May 31, 2025 | $585.5M | $304.8M | $280.7M | 52.1% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Feb 28, 2025
-0.7 pts
Year-over-year change
May 31, 2024
-3.3 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The primary driver of the gross margin decline is the faster growth in cost of revenue compared to revenue, both sequentially and year-over-year.
Compared to the immediately preceding quarter, revenue and gross profit rose modestly, but the increase in cost of revenue outpaced revenue, resulting in a weaker gross margin. Relative to the same quarter one year earlier, revenue was higher and gross profit was slightly lower, while cost of revenue increased substantially, leading to a lower gross margin.
Monitor the trajectory of cost of revenue relative to revenue, as its faster growth has compressed margin in the current quarter.