Fortinet, Inc. stock research
FY2024 Q3
Fortinet (FTNT) Gross Margin — Quarter Ended Sep 30, 2024
Revenue and gross profit both increased sequentially and year over year, while cost of revenue declined, resulting in a higher gross margin. The gross margin improvement was driven by cost growing more slowly than revenue.
Gross margin takeaway
Quarter ended Sep 30, 2024 · FY2024 Q3
Revenue and gross profit both increased sequentially and year over year, while cost of revenue declined, resulting in a higher gross margin. The gross margin improvement was driven by cost growing more slowly than revenue.
- The gross margin strengthened sequentially and year over year, primarily because cost of revenue increased at a slower rate than revenue.
- Compared to the prior quarter, gross margin was higher, supported by a lower cost of revenue despite higher revenue. Versus the same quarter last year, gross margin improved significantly as revenue increased while cost of revenue decreased.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
82.5%
Gross profit
$1.2B
Revenue
$1.5B
Cost of revenue
$263.4M
Quarter-over-quarter change
+1.7 pts
Year-over-year change
+6.3 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 |
|---|---|---|---|---|
| Dec 31, 2023 | $1.4B | $1.1B | $315.9M | 77.7% |
| Mar 31, 2024 | $1.4B | $1.0B | $304.7M | 77.5% |
| Jun 30, 2024 | $1.4B | $1.2B | $275.0M | 80.8% |
| Sep 30, 2024 | $1.5B | $1.2B | $263.4M | 82.5% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Jun 30, 2024
+1.7 pts
Year-over-year change
Sep 30, 2023
+6.3 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The gross margin strengthened sequentially and year over year, primarily because cost of revenue increased at a slower rate than revenue.
Compared to the prior quarter, gross margin was higher, supported by a lower cost of revenue despite higher revenue. Versus the same quarter last year, gross margin improved significantly as revenue increased while cost of revenue decreased.
Monitor deferred revenue growth, which provides visibility into future service revenue recognition.