STERIS plc stock research
FY2024 Q3
STERIS (STE) Gross Margin — Quarter Ended Dec 31, 2023
Revenue and gross profit increased both sequentially and year-over-year. Gross margin declined from the prior quarter but improved from a year ago, while the filing notes higher operating cash flow and capital expenditures.
Gross margin takeaway
Quarter ended Dec 31, 2023 · FY2024 Q3
Revenue and gross profit increased both sequentially and year-over-year. Gross margin declined from the prior quarter but improved from a year ago, while the filing notes higher operating cash flow and capital expenditures.
- The sequential decline in gross margin was associated with a larger increase in cost of revenue relative to gross profit. Year-over-year, gross profit grew faster than cost of revenue, supporting margin improvement.
- Compared to the prior quarter, gross margin weakened as cost of revenue rose more than gross profit. Compared to the same quarter last year, gross margin strengthened as gross profit growth outpaced cost of revenue growth.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
43.2%
Gross profit
$560.0M
Revenue
$1.3B
Cost of revenue
$737.7M
Quarter-over-quarter change
-1.0 pts
Year-over-year change
+0.3 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 | $1.2B | $529.0M | $654.4M | 44.7% |
| Sep 30, 2023 | $1.2B | $546.2M | $692.0M | 44.1% |
| Dec 31, 2023 | $1.3B | $560.0M | $737.7M | 43.2% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2023
-1.0 pts
Year-over-year change
Dec 31, 2022
+0.3 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The sequential decline in gross margin was associated with a larger increase in cost of revenue relative to gross profit. Year-over-year, gross profit grew faster than cost of revenue, supporting margin improvement.
Compared to the prior quarter, gross margin weakened as cost of revenue rose more than gross profit. Compared to the same quarter last year, gross margin strengthened as gross profit growth outpaced cost of revenue growth.
Monitor the relationship between cost of revenue and gross profit growth in upcoming quarters.