Phillips 66 stock research
FY2025 Q4
Phillips 66 (PSX) Gross Margin — Quarter Ended Dec 31, 2025
Revenue decreased slightly from the prior quarter, while gross profit increased and cost of revenue declined, leading to an improvement in gross margin. Compared to the same quarter last year, revenue was higher and gross profit rose significantly, more than offsetting a reduction in cost of revenue, which resulted in a stronger gross margin.
Gross margin takeaway
Quarter ended Dec 31, 2025 · FY2025 Q4
Revenue decreased slightly from the prior quarter, while gross profit increased and cost of revenue declined, leading to an improvement in gross margin. Compared to the same quarter last year, revenue was higher and gross profit rose significantly, more than offsetting a reduction in cost of revenue, which resulted in a stronger gross margin.
- The strongest observable margin driver is the reduction in cost of revenue relative to revenue, which enabled gross profit to expand even as revenue edged lower from the prior quarter.
- Compared to the prior quarter, gross margin improved as gross profit increased while revenue was slightly lower. Relative to the same quarter a year earlier, gross margin strengthened considerably due to a larger increase in gross profit than in revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
14.6%
Gross profit
$5.0B
Revenue
$34.1B
Cost of revenue
$29.1B
Quarter-over-quarter change
+2.1 pts
Year-over-year change
+5.9 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 | $30.4B | $2.8B | $27.7B | 9.1% |
| Jun 30, 2025 | $33.3B | $4.2B | $29.1B | 12.7% |
| Sep 30, 2025 | $34.5B | $4.3B | $30.2B | 12.4% |
| Dec 31, 2025 | $34.1B | $5.0B | $29.1B | 14.6% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2025
+2.1 pts
Year-over-year change
Dec 31, 2024
+5.9 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 enabled gross profit to expand even as revenue edged lower from the prior quarter.
Compared to the prior quarter, gross margin improved as gross profit increased while revenue was slightly lower. Relative to the same quarter a year earlier, gross margin strengthened considerably due to a larger increase in gross profit than in revenue.
Monitor the trajectory of cost of revenue, as further declines would continue to support gross margin expansion.