Steel Dynamics, Inc. stock research
FY2023 Q2
Steel Dynamics (STLD) Gross Margin — Quarter Ended Jun 30, 2023
Revenue and gross profit both increased compared to the prior quarter, while cost of revenue remained stable, leading to an improved gross margin. Versus the same quarter last year, revenue and gross profit were lower, cost of revenue decreased, and gross margin weakened.
Gross margin takeaway
Quarter ended Jun 30, 2023 · FY2023 Q2
Revenue and gross profit both increased compared to the prior quarter, while cost of revenue remained stable, leading to an improved gross margin. Versus the same quarter last year, revenue and gross profit were lower, cost of revenue decreased, and gross margin weakened.
- The strongest observable margin driver is the relationship between revenue and cost of revenue: revenue rose while cost of revenue held steady, which directly lifted gross profit and margin.
- Compared to the immediately preceding quarter, gross margin improved as revenue grew faster than cost of revenue. Compared to the same quarter one year earlier, gross margin weakened as revenue declined more sharply than cost of revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
25.7%
Gross profit
$1.3B
Revenue
$5.1B
Cost of revenue
$3.8B
Quarter-over-quarter change
+4.1 pts
Year-over-year change
-4.6 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, 2023 | $4.9B | $1.1B | $3.8B | 21.6% |
| Jun 30, 2023 | $5.1B | $1.3B | $3.8B | 25.7% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Mar 31, 2023
+4.1 pts
Year-over-year change
Jun 30, 2022
-4.6 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the relationship between revenue and cost of revenue: revenue rose while cost of revenue held steady, which directly lifted gross profit and margin.
Compared to the immediately preceding quarter, gross margin improved as revenue grew faster than cost of revenue. Compared to the same quarter one year earlier, gross margin weakened as revenue declined more sharply than cost of revenue.
Monitor the trajectory of cost of revenue relative to revenue, as its stability in the current quarter was a key factor in margin improvement.