Switch to:
Compuware Corp (NAS:CPWR)
Gross Profit
\$445.7 Mil (TTM As of Sep. 2014)

Compuware Corp's gross profit for the three months ended in Sep. 2014 was \$118.0 Mil. Compuware Corp's gross profit for the trailing twelve months (TTM) ended in Sep. 2014 was \$445.7 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Compuware Corp's gross profit for the three months ended in Sep. 2014 was \$118.0 Mil. Compuware Corp's revenue for the three months ended in Sep. 2014 was \$170.9 Mil. Therefore, Compuware Corp's Gross Margin for the quarter that ended in Sep. 2014 was 69.06%.

Compuware Corp had a gross margin of 69.06% for the quarter that ended in Sep. 2014 => Durable competitive advantage

Definition

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

Compuware 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 = 720.756 - 223.92 = 496.8

Compuware 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 = 170.893 - 52.88 = 118.0

Compuware Corp Gross Profit for the trailing twelve months (TTM) ended in Sep. 2014 was 162.152 (Dec. 2013 ) + 58.761 (Mar. 2014 ) + 106.757 (Jun. 2014 ) + 118.013 (Sep. 2014 ) = \$445.7 Mil.

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

Compuware 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 = 118.0 / 170.893 = 69.06 %

* 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

Compuware Corp had a gross margin of 69.06% for the quarter that ended in Sep. 2014 => Durable competitive advantage

Related Terms

Historical Data

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

Compuware Corp Annual Data

 Mar05 Mar06 Mar07 Mar08 Mar09 Mar10 Mar11 Mar12 Mar13 Mar14 Gross_Profit 759.6 764.6 722.2 738.9 656.1 617.3 553.1 668.9 528.0 496.8

Compuware Corp Quarterly Data

 Jun12 Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Gross_Profit 145.0 139.7 175.8 67.5 119.8 112.6 162.2 58.8 106.8 118.0
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to \$400 per referral. ( Learn More)