Oracle Corporation stock research
FY2025 Q1
Oracle (ORCL) Gross Margin — Quarter Ended Aug 31, 2024
Revenue and gross profit both decreased from the prior quarter but increased from the same quarter last year. Cost of revenue was unchanged sequentially and higher year over year, resulting in a gross margin that weakened on both comparisons.
Gross margin takeaway
Quarter ended Aug 31, 2024 · FY2025 Q1
Revenue and gross profit both decreased from the prior quarter but increased from the same quarter last year. Cost of revenue was unchanged sequentially and higher year over year, resulting in a gross margin that weakened on both comparisons.
- The strongest observable margin driver is the relative movement of cost of revenue: it remained flat sequentially while revenue declined, and it grew more quickly than revenue on a year-over-year basis, directly compressing gross margin.
- Compared with the prior quarter, gross margin was lower, driven by unchanged cost of revenue on a smaller revenue base. Compared with the same quarter last year, gross margin was also lower, as cost of revenue increased at a faster pace than revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
70.6%
Gross profit
$9.4B
Revenue
$13.3B
Cost of revenue
$3.9B
Quarter-over-quarter change
-1.9 pts
Year-over-year change
-0.4 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 |
|---|---|---|---|---|
| Nov 30, 2023 | $12.9B | $9.2B | $3.7B | 71.1% |
| Feb 29, 2024 | $13.3B | $9.4B | $3.9B | 70.9% |
| May 31, 2024 | $14.3B | $10.4B | $3.9B | 72.5% |
| Aug 31, 2024 | $13.3B | $9.4B | $3.9B | 70.6% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
May 31, 2024
-1.9 pts
Year-over-year change
Aug 31, 2023
-0.4 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the relative movement of cost of revenue: it remained flat sequentially while revenue declined, and it grew more quickly than revenue on a year-over-year basis, directly compressing gross margin.
Compared with the prior quarter, gross margin was lower, driven by unchanged cost of revenue on a smaller revenue base. Compared with the same quarter last year, gross margin was also lower, as cost of revenue increased at a faster pace than revenue.
Monitor the trend in cost of revenue relative to revenue, as its growth rate is a key factor in gross margin direction.