Westinghouse Air Brake Technologies Corporation stock research
FY2023 Q2
Westinghouse Air Brake Technologies (WAB) 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 gross margin declined slightly from the prior quarter and more notably from a year ago. The cost of revenue grew at a faster pace than revenue, leading to margin compression.
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 gross margin declined slightly from the prior quarter and more notably from a year ago. The cost of revenue grew at a faster pace than revenue, leading to margin compression.
- The primary observable driver is the growth rate of cost of revenue outpacing revenue growth, which squeezed gross margin despite higher absolute gross profit.
- Compared to the prior quarter, revenue, gross profit, and cost of revenue were all higher, while gross margin was slightly lower. Versus the same quarter a year ago, revenue, gross profit, and cost of revenue were higher, with gross margin lower.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
30.0%
Gross profit
$723.0M
Revenue
$2.4B
Cost of revenue
$1.7B
Quarter-over-quarter change
-0.3 pts
Year-over-year change
-1.5 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 | $2.2B | $665.0M | $1.5B | 30.3% |
| Jun 30, 2023 | $2.4B | $723.0M | $1.7B | 30.0% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Mar 31, 2023
-0.3 pts
Year-over-year change
Jun 30, 2022
-1.5 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The primary observable driver is the growth rate of cost of revenue outpacing revenue growth, which squeezed gross margin despite higher absolute gross profit.
Compared to the prior quarter, revenue, gross profit, and cost of revenue were all higher, while gross margin was slightly lower. Versus the same quarter a year ago, revenue, gross profit, and cost of revenue were higher, with gross margin lower.
Monitor the trend of cost of revenue relative to revenue, as its faster growth has been the key factor in margin weakening.