Super Micro Computer, Inc. stock research
FY2025 Q3
Super Micro Computer (SMCI) Gross Margin — Quarter Ended Mar 31, 2025
Revenue decreased compared to both the prior quarter and the same quarter last year, while cost of revenue declined less proportionally, resulting in a lower gross profit and a weakened gross margin. The gross margin contracted versus both the immediately preceding quarter and the year-ago period, reflecting a tighter spread between revenue and cost of revenue.
Gross margin takeaway
Quarter ended Mar 31, 2025 · FY2025 Q3
Revenue decreased compared to both the prior quarter and the same quarter last year, while cost of revenue declined less proportionally, resulting in a lower gross profit and a weakened gross margin. The gross margin contracted versus both the immediately preceding quarter and the year-ago period, reflecting a tighter spread between revenue and cost of revenue.
- The most observable margin driver is the relationship between revenue and cost of revenue; revenue fell while cost of revenue declined at a slower rate, compressing gross margin. The largest absolute change is in revenue, which declined from the prior quarter.
- Gross margin decreased sequentially from the prior quarter and was lower than the same quarter one year ago. Revenue and gross profit were both lower compared with the previous quarter and the year-ago period, while cost of revenue was lower than the prior quarter but higher than the same quarter last year.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
9.6%
Gross profit
$440.2M
Revenue
$4.6B
Cost of revenue
$4.2B
Quarter-over-quarter change
-2.2 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 |
|---|---|---|---|---|
| Jun 30, 2024 | $5.4B | $546.0M | $4.8B | 10.2% |
| Sep 30, 2024 | $5.9B | $775.6M | $5.2B | 13.1% |
| Dec 31, 2024 | $5.7B | $670.0M | $5.0B | 11.8% |
| Mar 31, 2025 | $4.6B | $440.2M | $4.2B | 9.6% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Dec 31, 2024
-2.2 pts
Year-over-year change
Mar 31, 2024
-5.9 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The most observable margin driver is the relationship between revenue and cost of revenue; revenue fell while cost of revenue declined at a slower rate, compressing gross margin. The largest absolute change is in revenue, which declined from the prior quarter.
Gross margin decreased sequentially from the prior quarter and was lower than the same quarter one year ago. Revenue and gross profit were both lower compared with the previous quarter and the year-ago period, while cost of revenue was lower than the prior quarter but higher than the same quarter last year.
The trajectory of revenue relative to cost of revenue should be monitored, as the current margin compression suggests cost reductions are not keeping pace with revenue declines.