Western Digital Corporation stock research
FY2023 Q3
Western Digital (WDC) Gross Margin — Quarter Ended Mar 31, 2023
Revenue and gross profit both declined versus the prior quarter and the same quarter a year ago, while cost of revenue decreased less proportionally. Consequently, gross margin weakened significantly compared with both periods.
Gross margin takeaway
Quarter ended Mar 31, 2023 · FY2023 Q3
Revenue and gross profit both declined versus the prior quarter and the same quarter a year ago, while cost of revenue decreased less proportionally. Consequently, gross margin weakened significantly compared with both periods.
- The relationship among revenue, gross profit, cost of revenue, and gross margin shows that the decline in gross profit outpaced the decline in revenue, leading to a compressed gross margin. Cost of revenue fell only modestly, which was the most directly observable factor in the margin compression.
- Compared with the immediately preceding quarter, revenue was lower, gross profit was lower, and gross margin weakened. Versus the same quarter one year earlier, all three metrics were lower, with gross margin significantly weakened.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
10.2%
Gross profit
$286.0M
Revenue
$2.8B
Cost of revenue
$2.5B
Quarter-over-quarter change
n/a
Year-over-year change
-16.8 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 | $2.8B | $286.0M | $2.5B | 10.2% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Previous quarter unavailable
n/a
Year-over-year change
Apr 1, 2022
-16.8 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The relationship among revenue, gross profit, cost of revenue, and gross margin shows that the decline in gross profit outpaced the decline in revenue, leading to a compressed gross margin. Cost of revenue fell only modestly, which was the most directly observable factor in the margin compression.
Compared with the immediately preceding quarter, revenue was lower, gross profit was lower, and gross margin weakened. Versus the same quarter one year earlier, all three metrics were lower, with gross margin significantly weakened.
Monitor the trend in cost of revenue relative to revenue, as the slower decline in cost was a key observable factor in the margin change.