Zoetis Inc. stock research
FY2026 Q1
Zoetis (ZTS) Gross Margin & Quarterly History
Explore Zoetis Inc. (ZTS) gross margin from 2023 through the latest reported quarter, using SEC-sourced revenue, gross profit, and direct costs.
Gross margin takeaway
Quarter ended Mar 31, 2026 · FY2026 Q1
Revenue decreased from the prior quarter while gross profit also declined, but cost of revenue fell at a faster rate, resulting in an improved gross margin. Compared to the same quarter last year, revenue was higher and gross profit was stable, yet cost of revenue grew more quickly, leading to a slightly weakened gross margin.
- The strongest observable margin driver is the change in cost of revenue relative to revenue. In the current quarter, cost of revenue declined more sharply than revenue compared to the prior quarter, which supported margin improvement.
- Compared to the immediately preceding quarter, gross margin improved as cost of revenue decreased faster than revenue. Versus the same quarter one year earlier, gross margin weakened slightly as cost of revenue grew at a higher rate than revenue.
Gross margin snapshot
The selected quarter's reported revenue, gross profit, direct costs, and margin comparisons.
Gross margin
71.7%
Gross profit
$1.6B
Revenue
$2.3B
Cost of revenue
$641.0M
Quarter-over-quarter change
+1.5 pts
Year-over-year change
-0.2 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 |
|---|---|---|---|---|
| Jun 30, 2025 | $2.5B | $1.8B | $649.0M | 73.6% |
| Sep 30, 2025 | $2.4B | $1.7B | $683.0M | 71.5% |
| Dec 31, 2025 | $2.4B | $1.7B | $712.0M | 70.2% |
| Mar 31, 2026 | $2.3B | $1.6B | $641.0M | 71.7% |
Quarterly comparisons
Compare the selected margin with the preceding quarter and the same fiscal quarter one year earlier.
Previous-quarter change
Dec 31, 2025
+1.5 pts
Year-over-year change
Mar 31, 2025
-0.2 pts
What the margin says
Filing-constrained interpretation of margin direction, comparisons, and what to monitor next.
The strongest observable margin driver is the change in cost of revenue relative to revenue. In the current quarter, cost of revenue declined more sharply than revenue compared to the prior quarter, which supported margin improvement.
Compared to the immediately preceding quarter, gross margin improved as cost of revenue decreased faster than revenue. Versus the same quarter one year earlier, gross margin weakened slightly as cost of revenue grew at a higher rate than revenue.
Monitor the trajectory of cost of revenue relative to revenue in upcoming quarters, as its growth rate has diverged from revenue trends year over year.
Peer context
Latest available gross margins for related public companies.
| Company | Gross margin |
|---|---|
| Zoetis Inc. (ZTS) | 71.7% |