International Paper Company stock research
FY2024 Q1
International Paper (IP) Gross Margin — Quarter Ended Mar 31, 2024
Revenue increased compared to the prior quarter but decreased compared to the same quarter a year earlier. Gross profit was lower than both prior periods, and gross margin weakened as cost of revenue did not move in proportion to revenue.
Gross margin takeaway
Quarter ended Mar 31, 2024 · FY2024 Q1
Revenue increased compared to the prior quarter but decreased compared to the same quarter a year earlier. Gross profit was lower than both prior periods, and gross margin weakened as cost of revenue did not move in proportion to revenue.
- The most notable driver was the relative movement of cost of revenue, which rose faster than revenue on a sequential basis while declining less than revenue on a year-over-year basis. The filing discusses the timing of mill outage spending affecting working capital and inventory balances, which influenced cost of revenue.
- Compared to the immediately preceding quarter, revenue increased but gross profit decreased, causing gross margin to weaken. Compared to the same quarter one year earlier, revenue and gross profit both declined, and gross margin weakened as well.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
12.5%
Gross profit
$491.0M
Revenue
$3.9B
Cost of revenue
$3.4B
Quarter-over-quarter change
-19.6 pts
Year-over-year change
-14.9 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 |
|---|---|---|---|---|
| Jun 30, 2023 | $4.7B | $1.3B | $3.4B | 28.2% |
| Sep 30, 2023 | $4.6B | $1.3B | $3.3B | 27.5% |
| Dec 31, 2023 | $1.7B | $553.0M | $1.2B | 32.2% |
| Mar 31, 2024 | $3.9B | $491.0M | $3.4B | 12.5% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Dec 31, 2023
-19.6 pts
Year-over-year change
Mar 31, 2023
-14.9 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The most notable driver was the relative movement of cost of revenue, which rose faster than revenue on a sequential basis while declining less than revenue on a year-over-year basis. The filing discusses the timing of mill outage spending affecting working capital and inventory balances, which influenced cost of revenue.
Compared to the immediately preceding quarter, revenue increased but gross profit decreased, causing gross margin to weaken. Compared to the same quarter one year earlier, revenue and gross profit both declined, and gross margin weakened as well.
Monitor the timing of mill outage spending and its impact on inventory balances and cost of revenue in future quarters.