Lumentum Holdings Inc. stock research
FY2024 Q2
Lumentum Holdings (LITE) Gross Margin — Quarter Ended Dec 30, 2023
Revenue increased compared to the prior quarter, but gross profit decreased, resulting in a lower gross margin. Cost of revenue rose more than proportionally, weakening profitability.
Gross margin takeaway
Quarter ended Dec 30, 2023 · FY2024 Q2
Revenue increased compared to the prior quarter, but gross profit decreased, resulting in a lower gross margin. Cost of revenue rose more than proportionally, weakening profitability.
- The primary driver of the margin decline was the disproportionate increase in cost of revenue relative to revenue growth. This suggests that the incremental revenue was generated at a lower margin.
- Compared to the prior quarter, gross margin weakened as revenue grew but gross profit fell. Versus the same quarter last year, both revenue and gross profit were lower, and gross margin also declined.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
17.4%
Gross profit
$64.0M
Revenue
$366.8M
Cost of revenue
$302.8M
Quarter-over-quarter change
-6.7 pts
Year-over-year change
-15.4 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 |
|---|---|---|---|---|
| Apr 1, 2023 | $383.4M | $112.0M | $271.4M | 29.2% |
| Jul 1, 2023 | $370.8M | $89.6M | $281.2M | 24.2% |
| Sep 30, 2023 | $317.6M | $76.7M | $240.9M | 24.1% |
| Dec 30, 2023 | $366.8M | $64.0M | $302.8M | 17.4% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2023
-6.7 pts
Year-over-year change
Dec 31, 2022
-15.4 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The primary driver of the margin decline was the disproportionate increase in cost of revenue relative to revenue growth. This suggests that the incremental revenue was generated at a lower margin.
Compared to the prior quarter, gross margin weakened as revenue grew but gross profit fell. Versus the same quarter last year, both revenue and gross profit were lower, and gross margin also declined.
Monitor the trend in cost of revenue relative to revenue, as its growth outpaced revenue this quarter.