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AeroVironment Inc (NAS:AVAV)
Gross Profit
$93.6 Mil (TTM As of Apr. 2014)

AeroVironment Inc's gross profit for the three months ended in Apr. 2014 was $30.1 Mil. AeroVironment Inc's gross profit for the trailing twelve months (TTM) ended in Apr. 2014 was $93.6 Mil.

Gross Margin is calculated as gross profit divided by its revenue. AeroVironment Inc's gross profit for the three months ended in Apr. 2014 was $30.1 Mil. AeroVironment Inc's revenue for the three months ended in Apr. 2014 was $73.5 Mil. Therefore, AeroVironment Inc's Gross Margin for the quarter that ended in Apr. 2014 was 41.01%.

AeroVironment Inc had a gross margin of 41.01% for the quarter that ended in Apr. 2014 => Durable competitive advantage

During the past 12 years, the highest Gross Margin of AeroVironment Inc was 44.32%. The lowest was 35.77%. And the median was 39.12%.


Definition

Gross Profit is the different between the sale prices and the cost of buying or producing the goods.

AeroVironment Inc's Gross Profit for the fiscal year that ended in Apr. 2014 is calculated as

Gross Profit (A: Apr. 2014 )=Revenue - Cost of Goods Sold
=251.703 - 158.09
=93.6

AeroVironment Inc's Gross Profit for the quarter that ended in Apr. 2014 is calculated as

Gross Profit (Q: Apr. 2014 )=Revenue - Cost of Goods Sold
=73.498 - 43.36
=30.1

AeroVironment Inc Gross Profit for the trailing twelve months (TTM) ended in Apr. 2014 was 12.545 (Jul. 2013 ) + 23.878 (Oct. 2013 ) + 27.052 (Jan. 2014 ) + 30.138 (Apr. 2014 ) = $93.6 Mil.

Gross Profit is the numerator in the calculation of Gross Margin:

AeroVironment Inc's Gross Margin for the quarter that ended in Apr. 2014 is calculated as

Gross Margin (Q: Apr. 2014 )=Gross Profit (Q: Apr. 2014 ) / Revenue (Q: Apr. 2014 )
=(Revenue - Cost of Goods Sold) / Revenue
=30.1 / 73.498
=41.01 %

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.


Explanation

Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.

Durable competitive advantage creates a high Gross Margin because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin

1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key

AeroVironment Inc had a gross margin of 41.01% for the quarter that ended in Apr. 2014 => Durable competitive advantage


Related Terms

Cost of Goods Sold, Gross Margin, Revenue


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

AeroVironment Inc Annual Data

Apr05Apr06Apr07Apr08Apr09Apr10Apr11Apr12Apr13Apr14
Gross_Profit 46.656.868.578.588.696.8117.2129.392.593.6

AeroVironment Inc Quarterly Data

Jan12Apr12Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14
Gross_Profit 27.449.619.535.619.717.712.523.927.130.1
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