West Pharmaceutical Services, Inc. stock research
FY2024 Q4
West Pharmaceutical Services (WST) Gross Margin — Quarter Ended Dec 31, 2024
Revenue in the current quarter was slightly higher than both the prior quarter and the same quarter last year, while gross profit increased from the prior quarter but decreased from the year-ago period. As a result, gross margin improved sequentially but weakened compared to the prior year.
Gross margin takeaway
Quarter ended Dec 31, 2024 · FY2024 Q4
Revenue in the current quarter was slightly higher than both the prior quarter and the same quarter last year, while gross profit increased from the prior quarter but decreased from the year-ago period. As a result, gross margin improved sequentially but weakened compared to the prior year.
- The sequential improvement in gross margin was primarily associated with a reduction in cost of revenue alongside a modest increase in revenue, whereas the year-over-year decline reflected a larger increase in cost of revenue relative to revenue growth.
- Compared to the immediately preceding quarter, gross margin was higher, as cost of revenue was lower while revenue was slightly higher. Relative to the same quarter one year earlier, gross margin was lower, because cost of revenue increased more than revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
36.5%
Gross profit
$273.6M
Revenue
$748.8M
Cost of revenue
$475.2M
Quarter-over-quarter change
+1.1 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, 2024 | $695.4M | $230.2M | $465.2M | 33.1% |
| Jun 30, 2024 | $702.1M | $230.0M | $472.1M | 32.8% |
| Sep 30, 2024 | $746.9M | $264.7M | $482.2M | 35.4% |
| Dec 31, 2024 | $748.8M | $273.6M | $475.2M | 36.5% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Sep 30, 2024
+1.1 pts
Year-over-year change
Dec 31, 2023
-1.5 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The sequential improvement in gross margin was primarily associated with a reduction in cost of revenue alongside a modest increase in revenue, whereas the year-over-year decline reflected a larger increase in cost of revenue relative to revenue growth.
Compared to the immediately preceding quarter, gross margin was higher, as cost of revenue was lower while revenue was slightly higher. Relative to the same quarter one year earlier, gross margin was lower, because cost of revenue increased more than revenue.
Monitor the trend of cost of revenue relative to revenue, as its movement has been a key factor in margin changes.