LegalZoom.com, Inc. stock research
FY2025 Q4
LegalZoom.com (LZ) Gross Margin — Quarter Ended Dec 31, 2025
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, while cost of revenue was lower than the prior quarter but higher than a year ago. Gross margin improved sequentially and year-over-year, reflecting a favorable relationship among the three metrics.
Gross margin takeaway
Quarter ended Dec 31, 2025 · FY2025 Q4
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, while cost of revenue was lower than the prior quarter but higher than a year ago. Gross margin improved sequentially and year-over-year, reflecting a favorable relationship among the three metrics.
- The strongest observable margin driver is the sequential decline in cost of revenue relative to revenue, which supported gross margin improvement. This contrasts with the year-ago period where cost of revenue grew at a slower pace than revenue.
- Compared to the immediately preceding quarter, revenue was slightly higher, gross profit was higher, and cost of revenue was lower, resulting in an improved gross margin. Compared to the same quarter one year earlier, revenue, gross profit, and cost of revenue were all higher, with gross margin also higher.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
67.6%
Gross profit
$128.5M
Revenue
$190.3M
Cost of revenue
$61.7M
Quarter-over-quarter change
+0.3 pts
Year-over-year change
+0.6 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, 2025 | $183.1M | $116.5M | $66.6M | 63.7% |
| Jun 30, 2025 | $192.5M | $125.1M | $67.4M | 65.0% |
| Sep 30, 2025 | $190.2M | $127.9M | $62.3M | 67.3% |
| Dec 31, 2025 | $190.3M | $128.5M | $61.7M | 67.6% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2025
+0.3 pts
Year-over-year change
Dec 31, 2024
+0.6 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the sequential decline in cost of revenue relative to revenue, which supported gross margin improvement. This contrasts with the year-ago period where cost of revenue grew at a slower pace than revenue.
Compared to the immediately preceding quarter, revenue was slightly higher, gross profit was higher, and cost of revenue was lower, resulting in an improved gross margin. Compared to the same quarter one year earlier, revenue, gross profit, and cost of revenue were all higher, with gross margin also higher.
Monitor the trajectory of cost of revenue relative to revenue in upcoming quarters to assess whether the recent improvement in gross margin can be sustained.