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Kratos Defense & Security Solutions Inc (NAS:KTOS)
Gross Profit
$159.4 Mil (TTM As of Mar. 2016)

Kratos Defense & Security Solutions Inc's gross profit for the three months ended in Mar. 2016 was $35.9 Mil. Kratos Defense & Security Solutions Inc's gross profit for the trailing twelve months (TTM) ended in Mar. 2016 was $159.4 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Kratos Defense & Security Solutions Inc's gross profit for the three months ended in Mar. 2016 was $35.9 Mil. Kratos Defense & Security Solutions Inc's revenue for the three months ended in Mar. 2016 was $153.0 Mil. Therefore, Kratos Defense & Security Solutions Inc's Gross Margin for the quarter that ended in Mar. 2016 was 23.46%.

Kratos Defense & Security Solutions Inc had a gross margin of 23.46% for the quarter that ended in Mar. 2016 => Competition eroding margins

During the past 13 years, the highest Gross Margin of Kratos Defense & Security Solutions Inc was 26.58%. The lowest was 16.32%. And the median was 23.33%.


Definition

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

Kratos Defense & Security Solutions Inc's Gross Profit for the fiscal year that ended in Dec. 2015 is calculated as

Gross Profit (A: Dec. 2015 )=Revenue - Cost of Goods Sold
=657.1 - 495.3
=161.8

Kratos Defense & Security Solutions Inc's Gross Profit for the quarter that ended in Mar. 2016 is calculated as

Gross Profit (Q: Mar. 2016 )=Revenue - Cost of Goods Sold
=153 - 117.1
=35.9

Kratos Defense & Security Solutions Inc Gross Profit for the trailing twelve months (TTM) ended in Mar. 2016 was 40.9 (Jun. 2015 ) + 40.4 (Sep. 2015 ) + 42.2 (Dec. 2015 ) + 35.9 (Mar. 2016 ) = $159.4 Mil.

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

Kratos Defense & Security Solutions Inc's Gross Margin for the quarter that ended in Mar. 2016 is calculated as

Gross Margin (Q: Mar. 2016 )=Gross Profit (Q: Mar. 2016 ) / Revenue (Q: Mar. 2016 )
=(Revenue - Cost of Goods Sold) / Revenue
=35.9 / 153
=23.46 %

* 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

Kratos Defense & Security Solutions Inc had a gross margin of 23.46% for the quarter that ended in Mar. 2016 => Competition eroding margins


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.

Kratos Defense & Security Solutions Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
Gross_Profit 53.531.659.569.390.0192.2257.2240.0218.2161.8

Kratos Defense & Security Solutions Inc Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
Gross_Profit 26.052.648.142.445.138.340.940.442.235.9
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