International Flavors & Fragrances Inc. stock research
FY2023 Q4
International Flavors & Fragrances (IFF) Gross Margin — Quarter Ended Dec 31, 2023
The company's gross margin improved compared to the same period last year, supported by a lower cost of revenue relative to revenue. However, sequentially the gross margin weakened as both revenue and gross profit declined.
Gross margin takeaway
Quarter ended Dec 31, 2023 · FY2023 Q4
The company's gross margin improved compared to the same period last year, supported by a lower cost of revenue relative to revenue. However, sequentially the gross margin weakened as both revenue and gross profit declined.
- The strongest observable driver is the year-over-year improvement in gross margin, which occurred alongside a reduction in revenue and a more pronounced reduction in cost of revenue.
- Compared to the prior quarter, revenue and gross profit were lower, leading to a lower gross margin. Compared to the same quarter a year ago, gross margin was higher despite lower revenue, due to a larger decline in cost of revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
31.8%
Gross profit
$860.0M
Revenue
$2.7B
Cost of revenue
$1.8B
Quarter-over-quarter change
-0.9 pts
Year-over-year change
+1.3 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 |
|---|---|---|---|---|
| Mar 31, 2023 | $3.0B | $964.0M | $2.1B | 31.8% |
| Jun 30, 2023 | $2.9B | $933.0M | $2.0B | 31.9% |
| Sep 30, 2023 | $2.8B | $924.0M | $1.9B | 32.8% |
| Dec 31, 2023 | $2.7B | $860.0M | $1.8B | 31.8% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2023
-0.9 pts
Year-over-year change
Dec 31, 2022
+1.3 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable driver is the year-over-year improvement in gross margin, which occurred alongside a reduction in revenue and a more pronounced reduction in cost of revenue.
Compared to the prior quarter, revenue and gross profit were lower, leading to a lower gross margin. Compared to the same quarter a year ago, gross margin was higher despite lower revenue, due to a larger decline in cost of revenue.
Monitor the trajectory of gross margin as revenue trends downward while cost management continues.