International Flavors & Fragrances Inc. stock research
FY2025 Q3
International Flavors & Fragrances (IFF) Gross Margin — Quarter Ended Sep 30, 2025
Revenue and gross profit both declined compared to the prior quarter and the same quarter last year, while cost of revenue was stable sequentially but lower year over year. Gross margin weakened from the prior quarter but improved relative to the same quarter one year earlier.
Gross margin takeaway
Quarter ended Sep 30, 2025 · FY2025 Q3
Revenue and gross profit both declined compared to the prior quarter and the same quarter last year, while cost of revenue was stable sequentially but lower year over year. Gross margin weakened from the prior quarter but improved relative to the same quarter one year earlier.
- The strongest observable driver is the change in cost of revenue relative to revenue: cost of revenue remained stable from the prior quarter while revenue decreased, pressuring gross margin, whereas cost of revenue dropped more than revenue year over year, supporting margin improvement.
- Sequentially, gross margin was lower as revenue declined with cost of revenue unchanged. Year over year, gross margin was higher as the decline in cost of revenue outpaced the decline in revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
36.5%
Gross profit
$983.0M
Revenue
$2.7B
Cost of revenue
$1.7B
Quarter-over-quarter change
-0.8 pts
Year-over-year change
+0.5 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 |
|---|---|---|---|---|
| Sep 30, 2024 | $2.9B | $1.1B | $1.9B | 36.0% |
| Mar 31, 2025 | $2.8B | $1.0B | $1.8B | 36.4% |
| Jun 30, 2025 | $2.8B | $1.0B | $1.7B | 37.3% |
| Sep 30, 2025 | $2.7B | $983.0M | $1.7B | 36.5% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Jun 30, 2025
-0.8 pts
Year-over-year change
Sep 30, 2024
+0.5 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable driver is the change in cost of revenue relative to revenue: cost of revenue remained stable from the prior quarter while revenue decreased, pressuring gross margin, whereas cost of revenue dropped more than revenue year over year, supporting margin improvement.
Sequentially, gross margin was lower as revenue declined with cost of revenue unchanged. Year over year, gross margin was higher as the decline in cost of revenue outpaced the decline in revenue.
Monitor the relationship between cost of revenue and revenue, particularly whether cost of revenue can be reduced further if revenue continues to decline.