Block, Inc. stock research
FY2023 Q2
Block (XYZ) 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 also rose. Gross margin weakened slightly from the prior quarter but improved relative to the same quarter last year.
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 also rose. Gross margin weakened slightly from the prior quarter but improved relative to the same quarter last year.
- The strongest observable margin driver is the relationship between revenue growth and cost of revenue growth. Revenue increased at a faster pace than cost of revenue compared to the same quarter last year, supporting gross margin improvement.
- Compared to the prior quarter, gross margin weakened as cost of revenue grew at a slightly faster rate than revenue. Compared to the same quarter last year, gross margin improved, with revenue growth outpacing cost of revenue growth.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
33.7%
Gross profit
$1.9B
Revenue
$5.5B
Cost of revenue
$3.7B
Quarter-over-quarter change
-0.6 pts
Year-over-year change
+0.3 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 | $5.0B | $1.7B | $3.3B | 34.4% |
| Jun 30, 2023 | $5.5B | $1.9B | $3.7B | 33.7% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Mar 31, 2023
-0.6 pts
Year-over-year change
Jun 30, 2022
+0.3 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 at a faster pace than cost of revenue compared to the same quarter last year, supporting gross margin improvement.
Compared to the prior quarter, gross margin weakened as cost of revenue grew at a slightly faster rate than revenue. Compared to the same quarter last year, gross margin improved, with revenue growth outpacing cost of revenue growth.
Monitor the trajectory of cost of revenue relative to revenue in upcoming quarters to assess margin sustainability.