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Capstone Turbine Corp (NAS:CPST)
Gross Profit
$22.1 Mil (TTM As of Sep. 2014)

Capstone Turbine Corp's gross profit for the three months ended in Sep. 2014 was $5.2 Mil. Capstone Turbine Corp's gross profit for the trailing twelve months (TTM) ended in Sep. 2014 was $22.1 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Capstone Turbine Corp's gross profit for the three months ended in Sep. 2014 was $5.2 Mil. Capstone Turbine Corp's revenue for the three months ended in Sep. 2014 was $32.2 Mil. Therefore, Capstone Turbine Corp's Gross Margin for the quarter that ended in Sep. 2014 was 16.26%.

Capstone Turbine Corp had a gross margin of 16.26% for the quarter that ended in Sep. 2014 => No sustainable competitive advantage

During the past 13 years, the highest Gross Margin of Capstone Turbine Corp was 16.30%. The lowest was -6251.19%. And the median was -13.72%.


Definition

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

Capstone Turbine Corp's Gross Profit for the fiscal year that ended in Mar. 2014 is calculated as

Gross Profit (A: Mar. 2014 )=Revenue - Cost of Goods Sold
=133.105 - 111.409
=21.7

Capstone Turbine Corp's Gross Profit for the quarter that ended in Sep. 2014 is calculated as

Gross Profit (Q: Sep. 2014 )=Revenue - Cost of Goods Sold
=32.248 - 27.005
=5.2

Capstone Turbine Corp Gross Profit for the trailing twelve months (TTM) ended in Sep. 2014 was 7.335 (Dec. 2013 ) + 6.146 (Mar. 2014 ) + 3.416 (Jun. 2014 ) + 5.243 (Sep. 2014 ) = $22.1 Mil.

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

Capstone Turbine Corp's Gross Margin for the quarter that ended in Sep. 2014 is calculated as

Gross Margin (Q: Sep. 2014 )=Gross Profit (Q: Sep. 2014 ) / Revenue (Q: Sep. 2014 )
=(Revenue - Cost of Goods Sold) / Revenue
=5.2 / 32.248
=16.26 %

* 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

Capstone Turbine Corp had a gross margin of 16.26% for the quarter that ended in Sep. 2014 => No sustainable 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.

Capstone Turbine Corp Annual Data

Mar05Mar06Mar07Mar08Mar09Mar10Mar11Mar12Mar13Mar14
Gross_Profit -6.9-10.5-5.0-3.8-5.3-8.4-0.55.414.421.7

Capstone Turbine Corp Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
Gross_Profit 2.22.64.65.03.34.97.36.13.45.2
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