Tyler Technologies, Inc. stock research
FY2023 Q3
Tyler Technologies (TYL) Gross Margin — Quarter Ended Sep 30, 2023
Revenue for the quarter was lower than the prior quarter but higher than the same quarter a year ago. Gross profit increased slightly from the prior quarter and improved year-over-year, while cost of revenue decreased from the prior quarter and increased year-over-year, resulting in a gross margin that improved both sequentially and compared to the same quarter last year.
Gross margin takeaway
Quarter ended Sep 30, 2023 · FY2023 Q3
Revenue for the quarter was lower than the prior quarter but higher than the same quarter a year ago. Gross profit increased slightly from the prior quarter and improved year-over-year, while cost of revenue decreased from the prior quarter and increased year-over-year, resulting in a gross margin that improved both sequentially and compared to the same quarter last year.
- The sequential improvement in gross margin was associated with a decrease in cost of revenue while revenue also decreased, but the cost decrease was proportionally larger, leading to higher gross profit and a stronger margin. Year-over-year, the margin gain was tied to revenue growing faster than cost of revenue.
- Compared to the immediately preceding quarter, revenue was lower, gross profit was slightly higher, cost of revenue was lower, and gross margin was higher. Compared to the same quarter one year earlier, revenue, gross profit, and cost of revenue were all higher, with gross margin also higher.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
45.5%
Gross profit
$225.2M
Revenue
$494.7M
Cost of revenue
$269.5M
Quarter-over-quarter change
+1.3 pts
Year-over-year change
+2.3 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 |
|---|---|---|---|---|
| Mar 31, 2023 | $471.9M | $199.8M | $272.0M | 42.4% |
| Jun 30, 2023 | $504.3M | $223.2M | $281.1M | 44.3% |
| Sep 30, 2023 | $494.7M | $225.2M | $269.5M | 45.5% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Jun 30, 2023
+1.3 pts
Year-over-year change
Sep 30, 2022
+2.3 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The sequential improvement in gross margin was associated with a decrease in cost of revenue while revenue also decreased, but the cost decrease was proportionally larger, leading to higher gross profit and a stronger margin. Year-over-year, the margin gain was tied to revenue growing faster than cost of revenue.
Compared to the immediately preceding quarter, revenue was lower, gross profit was slightly higher, cost of revenue was lower, and gross margin was higher. Compared to the same quarter one year earlier, revenue, gross profit, and cost of revenue were all higher, with gross margin also higher.
Monitor the relationship between revenue and cost of revenue, as the sequential decrease in cost of revenue outpaced the revenue decline, contributing to margin improvement.