Lennox International Inc. stock research
FY2024 Q1
Lennox International (LII) Gross Margin — Quarter Ended Mar 31, 2024
Revenue was stable compared to the same quarter last year, while gross profit increased and cost of revenue decreased, leading to an improved gross margin. Sequentially, revenue declined from the prior quarter, but gross margin strengthened as cost of revenue fell more sharply than revenue.
Gross margin takeaway
Quarter ended Mar 31, 2024 · FY2024 Q1
Revenue was stable compared to the same quarter last year, while gross profit increased and cost of revenue decreased, leading to an improved gross margin. Sequentially, revenue declined from the prior quarter, but gross margin strengthened as cost of revenue fell more sharply than revenue.
- The strongest observable margin driver is the reduction in cost of revenue relative to revenue, which directly lifted gross margin both sequentially and year-over-year.
- Compared to the immediately preceding quarter, revenue was lower but gross margin was higher, driven by a proportionally larger decrease in cost of revenue. Versus the same quarter one year earlier, revenue was stable while gross margin improved, as cost of revenue decreased and gross profit increased.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
32.5%
Gross profit
$340.0M
Revenue
$1.0B
Cost of revenue
$707.1M
Quarter-over-quarter change
+1.6 pts
Year-over-year change
+3.3 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 |
|---|---|---|---|---|
| Jun 30, 2023 | $1.4B | $457.8M | $953.6M | 32.4% |
| Sep 30, 2023 | $1.4B | $428.5M | $937.8M | 31.4% |
| Dec 31, 2023 | $1.2B | $356.2M | $798.6M | 30.8% |
| Mar 31, 2024 | $1.0B | $340.0M | $707.1M | 32.5% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Dec 31, 2023
+1.6 pts
Year-over-year change
Mar 31, 2023
+3.3 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the reduction in cost of revenue relative to revenue, which directly lifted gross margin both sequentially and year-over-year.
Compared to the immediately preceding quarter, revenue was lower but gross margin was higher, driven by a proportionally larger decrease in cost of revenue. Versus the same quarter one year earlier, revenue was stable while gross margin improved, as cost of revenue decreased and gross profit increased.
Monitor the trajectory of cost of revenue relative to revenue, as its recent decline has been the primary factor behind margin improvement.