Steel Dynamics, Inc. stock research
FY2023 Q4
Steel Dynamics (STLD) Gross Margin — Quarter Ended Dec 31, 2023
Revenue and gross profit both decreased compared to the prior quarter and the same quarter last year, while cost of revenue also declined. As a result, gross margin weakened relative to both periods.
Gross margin takeaway
Quarter ended Dec 31, 2023 · FY2023 Q4
Revenue and gross profit both decreased compared to the prior quarter and the same quarter last year, while cost of revenue also declined. As a result, gross margin weakened relative to both periods.
- The decline in gross profit was proportionally larger than the decline in revenue, leading to a lower gross margin. Cost of revenue decreased at a slower rate than revenue, compressing profitability.
- Compared to the immediately preceding quarter, revenue, gross profit, and gross margin were all lower. Versus the same quarter one year earlier, the same metrics also showed a decline.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
17.3%
Gross profit
$730.9M
Revenue
$4.2B
Cost of revenue
$3.5B
Quarter-over-quarter change
-3.5 pts
Year-over-year change
-3.2 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% |
| Sep 30, 2023 | $4.6B | $952.0M | $3.6B | 20.8% |
| Dec 31, 2023 | $4.2B | $730.9M | $3.5B | 17.3% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2023
-3.5 pts
Year-over-year change
Dec 31, 2022
-3.2 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The decline in gross profit was proportionally larger than the decline in revenue, leading to a lower gross margin. Cost of revenue decreased at a slower rate than revenue, compressing profitability.
Compared to the immediately preceding quarter, revenue, gross profit, and gross margin were all lower. Versus the same quarter one year earlier, the same metrics also showed a decline.
Monitor the trajectory of cost of revenue relative to revenue, as its slower decline was the primary factor in margin compression.