VeriSign, Inc. stock research
FY2023 Q2
VeriSign (VRSN) Gross Margin — Quarter Ended Jun 30, 2023
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, while cost of revenue remained relatively stable. As a result, gross margin improved modestly, reflecting a slightly larger proportion of revenue converting into gross profit.
Gross margin takeaway
Quarter ended Jun 30, 2023 · FY2023 Q2
Revenue and gross profit both increased compared to the prior quarter and the same quarter last year, while cost of revenue remained relatively stable. As a result, gross margin improved modestly, reflecting a slightly larger proportion of revenue converting into gross profit.
- The improvement in gross margin was driven by revenue growing more than cost of revenue, which held nearly steady. This suggests that the business is generating additional gross profit without a commensurate increase in direct costs.
- Compared to the preceding quarter, gross margin was slightly higher, and relative to the same quarter one year earlier, it was also higher. The increases in both revenue and gross profit outpaced the change in cost of revenue in both comparisons.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
86.5%
Gross profit
$321.7M
Revenue
$372.0M
Cost of revenue
$50.3M
Quarter-over-quarter change
+0.2 pts
Year-over-year change
+0.5 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 | $364.4M | $314.5M | $49.9M | 86.3% |
| Jun 30, 2023 | $372.0M | $321.7M | $50.3M | 86.5% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Mar 31, 2023
+0.2 pts
Year-over-year change
Sep 30, 2022
+0.5 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The improvement in gross margin was driven by revenue growing more than cost of revenue, which held nearly steady. This suggests that the business is generating additional gross profit without a commensurate increase in direct costs.
Compared to the preceding quarter, gross margin was slightly higher, and relative to the same quarter one year earlier, it was also higher. The increases in both revenue and gross profit outpaced the change in cost of revenue in both comparisons.
Monitor the trend in cost of revenue, as it remained nearly unchanged while revenue grew, and any future uptick could narrow the gross margin.