Fair Isaac Corporation stock research
FY2023 Q3
Fair Isaac (FICO) Gross Margin — Quarter Ended Jun 30, 2023
Revenue rose compared with the prior quarter, and gross profit increased more than revenue, leading to an improved gross margin. Compared with the same quarter last year, revenue and gross profit were higher, and gross margin strengthened as cost of revenue was lower.
Gross margin takeaway
Quarter ended Jun 30, 2023 · FY2023 Q3
Revenue rose compared with the prior quarter, and gross profit increased more than revenue, leading to an improved gross margin. Compared with the same quarter last year, revenue and gross profit were higher, and gross margin strengthened as cost of revenue was lower.
- The most observable driver of gross margin expansion is the decline in cost of revenue: it was lower both sequentially and year-over-year, while revenue increased, widening the spread between revenue and cost.
- Gross margin was higher than the preceding quarter and also higher than the same quarter one year earlier. Revenue increased sequentially and year-over-year, while cost of revenue decreased sequentially and was lower than the year-ago level.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
82.0%
Gross profit
$326.8M
Revenue
$398.7M
Cost of revenue
$71.8M
Quarter-over-quarter change
+3.0 pts
Year-over-year change
+4.5 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 | $380.3M | $300.5M | $79.8M | 79.0% |
| Jun 30, 2023 | $398.7M | $326.8M | $71.8M | 82.0% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Mar 31, 2023
+3.0 pts
Year-over-year change
Jun 30, 2022
+4.5 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The most observable driver of gross margin expansion is the decline in cost of revenue: it was lower both sequentially and year-over-year, while revenue increased, widening the spread between revenue and cost.
Gross margin was higher than the preceding quarter and also higher than the same quarter one year earlier. Revenue increased sequentially and year-over-year, while cost of revenue decreased sequentially and was lower than the year-ago level.
Monitor the trajectory of cost of revenue, given its notable decline contributed to margin improvement in the current period.