F5, Inc. stock research
FY2023 Q4
F5 (FFIV) Gross Margin — Quarter Ended Sep 30, 2023
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, while cost of revenue decreased year over year. Gross margin improved sequentially and compared to the year-ago period, reflecting a higher proportion of revenue retained as gross profit.
Gross margin takeaway
Quarter ended Sep 30, 2023 · FY2023 Q4
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, while cost of revenue decreased year over year. Gross margin improved sequentially and compared to the year-ago period, reflecting a higher proportion of revenue retained as gross profit.
- The strongest observable margin driver is the reduction in cost of revenue relative to revenue, as cost of revenue declined year over year while revenue increased, leading to a higher gross margin.
- Compared to the immediately preceding quarter, revenue and gross profit were slightly higher, cost of revenue was slightly lower, and gross margin improved. Compared to the same quarter one year earlier, revenue and gross profit were higher, cost of revenue was lower, and gross margin strengthened.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
80.1%
Gross profit
$566.0M
Revenue
$707.0M
Cost of revenue
$141.0M
Quarter-over-quarter change
+0.2 pts
Year-over-year change
+1.1 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, 2023 | $703.2M | $547.5M | $155.7M | 77.9% |
| Jun 30, 2023 | $702.6M | $561.0M | $141.7M | 79.8% |
| Sep 30, 2023 | $707.0M | $566.0M | $141.0M | 80.1% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Jun 30, 2023
+0.2 pts
Year-over-year change
Sep 30, 2022
+1.1 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the reduction in cost of revenue relative to revenue, as cost of revenue declined year over year while revenue increased, leading to a higher gross margin.
Compared to the immediately preceding quarter, revenue and gross profit were slightly higher, cost of revenue was slightly lower, and gross margin improved. Compared to the same quarter one year earlier, revenue and gross profit were higher, cost of revenue was lower, and gross margin strengthened.
Monitor the trend in cost of revenue, as its decline contributed to margin improvement and any reversal could pressure gross margin.