Fortinet, Inc. stock research
FY2024 Q4
Fortinet (FTNT) Gross Margin — Quarter Ended Dec 31, 2024
Revenue and gross profit both increased compared to both the prior quarter and the same quarter last year. Gross margin improved from a year ago but decreased slightly from the prior quarter.
Gross margin takeaway
Quarter ended Dec 31, 2024 · FY2024 Q4
Revenue and gross profit both increased compared to both the prior quarter and the same quarter last year. Gross margin improved from a year ago but decreased slightly from the prior quarter.
- Gross margin was higher year over year as cost of revenue remained nearly flat while revenue grew, but was lower sequentially as cost of revenue rose faster than revenue. The year-over-year improvement was the stronger observable effect.
- Compared to the prior quarter, revenue increased while cost of revenue increased at a greater rate, causing gross margin to narrow. Compared to the same quarter last year, revenue increased with cost of revenue essentially unchanged, resulting in a wider gross margin.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
81.1%
Gross profit
$1.3B
Revenue
$1.7B
Cost of revenue
$314.5M
Quarter-over-quarter change
-1.5 pts
Year-over-year change
+3.4 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, 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% |
| Dec 31, 2024 | $1.7B | $1.3B | $314.5M | 81.1% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2024
-1.5 pts
Year-over-year change
Dec 31, 2023
+3.4 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
Gross margin was higher year over year as cost of revenue remained nearly flat while revenue grew, but was lower sequentially as cost of revenue rose faster than revenue. The year-over-year improvement was the stronger observable effect.
Compared to the prior quarter, revenue increased while cost of revenue increased at a greater rate, causing gross margin to narrow. Compared to the same quarter last year, revenue increased with cost of revenue essentially unchanged, resulting in a wider gross margin.
Monitor whether the sequential increase in cost of revenue moderates in future quarters.