Philip Morris International Inc. stock research
FY2024 Q1
Philip Morris International (PM) Gross Margin — Quarter Ended Mar 31, 2024
In the current quarter, revenue decreased from the preceding quarter but increased from the same quarter one year earlier. Gross profit remained stable compared to the preceding quarter and grew versus the prior year, while cost of revenue declined sequentially and rose less than revenue on an annual basis, resulting in a higher gross margin.
Gross margin takeaway
Quarter ended Mar 31, 2024 · FY2024 Q1
In the current quarter, revenue decreased from the preceding quarter but increased from the same quarter one year earlier. Gross profit remained stable compared to the preceding quarter and grew versus the prior year, while cost of revenue declined sequentially and rose less than revenue on an annual basis, resulting in a higher gross margin.
- The strongest observable margin driver is the change in cost of revenue relative to revenue. Sequentially, cost of revenue declined while revenue also fell, but the decline in cost was proportionally larger; year over year, cost of revenue increased at a slower pace than revenue.
- Compared to the preceding quarter, gross margin improved as cost of revenue decreased while gross profit held steady. Compared to the same quarter one year earlier, gross margin also improved, driven by a larger increase in gross profit relative to the increase in cost of revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
63.7%
Gross profit
$5.6B
Revenue
$8.8B
Cost of revenue
$3.2B
Quarter-over-quarter change
+1.9 pts
Year-over-year change
+1.5 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 | $9.0B | $5.7B | $3.2B | 64.0% |
| Sep 30, 2023 | $9.1B | $6.0B | $3.2B | 65.4% |
| Dec 31, 2023 | $9.0B | $5.6B | $3.5B | 61.7% |
| Mar 31, 2024 | $8.8B | $5.6B | $3.2B | 63.7% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Dec 31, 2023
+1.9 pts
Year-over-year change
Mar 31, 2023
+1.5 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the change in cost of revenue relative to revenue. Sequentially, cost of revenue declined while revenue also fell, but the decline in cost was proportionally larger; year over year, cost of revenue increased at a slower pace than revenue.
Compared to the preceding quarter, gross margin improved as cost of revenue decreased while gross profit held steady. Compared to the same quarter one year earlier, gross margin also improved, driven by a larger increase in gross profit relative to the increase in cost of revenue.
Monitor the trajectory of cost of revenue relative to revenue in upcoming quarters to assess whether the favorable relationship persists.