Ulta Beauty, Inc. stock research
FY2024 Q2
Ulta Beauty (ULTA) Gross Margin — Quarter Ended Aug 3, 2024
Revenue was higher than the prior quarter and the same quarter last year, while gross profit was lower than the prior quarter and the year-ago quarter. Cost of revenue increased relative to both comparison periods, resulting in gross margin that weakened versus the prior quarter and the year-ago quarter.
Gross margin takeaway
Quarter ended Aug 3, 2024 · FY2024 Q2
Revenue was higher than the prior quarter and the same quarter last year, while gross profit was lower than the prior quarter and the year-ago quarter. Cost of revenue increased relative to both comparison periods, resulting in gross margin that weakened versus the prior quarter and the year-ago quarter.
- The strongest observable margin driver is the relationship between revenue growth and cost of revenue growth; revenue increased from the year-ago quarter, but cost of revenue rose more, compressing gross profit. This imbalance is the primary factor behind the gross margin decline.
- Compared with the immediately preceding quarter, revenue was lower and cost of revenue was lower, but the decline in gross profit was proportionally larger, leading to a weakened gross margin. Versus the same quarter one year earlier, revenue was higher, yet higher cost of revenue outpaced revenue growth, resulting in a lower gross profit and a weakened gross margin.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
38.3%
Gross profit
$978.2M
Revenue
$2.6B
Cost of revenue
$1.6B
Quarter-over-quarter change
-0.9 pts
Year-over-year change
-0.9 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 |
|---|---|---|---|---|
| Oct 28, 2023 | $2.5B | $992.1M | $1.5B | 39.9% |
| Feb 3, 2024 | $3.6B | $1.3B | $2.2B | 37.7% |
| May 4, 2024 | $2.7B | $1.1B | $1.7B | 39.2% |
| Aug 3, 2024 | $2.6B | $978.2M | $1.6B | 38.3% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
May 4, 2024
-0.9 pts
Year-over-year change
Jul 29, 2023
-0.9 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 growth and cost of revenue growth; revenue increased from the year-ago quarter, but cost of revenue rose more, compressing gross profit. This imbalance is the primary factor behind the gross margin decline.
Compared with the immediately preceding quarter, revenue was lower and cost of revenue was lower, but the decline in gross profit was proportionally larger, leading to a weakened gross margin. Versus the same quarter one year earlier, revenue was higher, yet higher cost of revenue outpaced revenue growth, resulting in a lower gross profit and a weakened gross margin.
Monitor the trajectory of cost of revenue relative to revenue, as the current period shows a faster increase in cost of revenue compared to the year-ago quarter.