The Home Depot, Inc. stock research
FY2024 Q2
The Home Depot (HD) Gross Margin — Quarter Ended Jul 28, 2024
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, while cost of revenue was stable year over year but rose sequentially. Gross margin weakened slightly from the prior quarter but improved relative to the same quarter a year ago.
Gross margin takeaway
Quarter ended Jul 28, 2024 · FY2024 Q2
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, while cost of revenue was stable year over year but rose sequentially. Gross margin weakened slightly from the prior quarter but improved relative to the same quarter a year ago.
- The strongest observable margin driver is the relationship between revenue and cost of revenue: revenue grew faster than cost of revenue compared to the same quarter last year, supporting gross margin expansion. Sequentially, cost of revenue increased at a slightly higher rate than revenue, leading to a modest margin decline.
- Compared to the immediately preceding quarter, gross margin was lower, driven by a proportionally larger increase in cost of revenue relative to revenue. Versus the same quarter one year earlier, gross margin was higher, as revenue growth outpaced cost of revenue growth.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
33.4%
Gross profit
$14.4B
Revenue
$43.2B
Cost of revenue
$28.8B
Quarter-over-quarter change
-0.8 pts
Year-over-year change
+0.4 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 |
|---|---|---|---|---|
| Oct 29, 2023 | $37.7B | $12.7B | $25.0B | 33.8% |
| Jan 28, 2024 | $34.8B | $11.5B | $23.3B | 33.1% |
| Apr 28, 2024 | $36.4B | $12.4B | $24.0B | 34.1% |
| Jul 28, 2024 | $43.2B | $14.4B | $28.8B | 33.4% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Apr 28, 2024
-0.8 pts
Year-over-year change
Jul 30, 2023
+0.4 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the relationship between revenue and cost of revenue: revenue grew faster than cost of revenue compared to the same quarter last year, supporting gross margin expansion. Sequentially, cost of revenue increased at a slightly higher rate than revenue, leading to a modest margin decline.
Compared to the immediately preceding quarter, gross margin was lower, driven by a proportionally larger increase in cost of revenue relative to revenue. Versus the same quarter one year earlier, gross margin was higher, as revenue growth outpaced cost of revenue growth.
Monitor the sequential trend in cost of revenue relative to revenue, as a continued faster increase in cost of revenue could pressure gross margin further.