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M/A-COM Technology Solutions Holdings Inc (NAS:MTSI)
Gross Profit
$169.9 Mil (TTM As of Sep. 2014)

M/A-COM Technology Solutions Holdings Inc's gross profit for the three months ended in Sep. 2014 was $56.2 Mil. M/A-COM Technology Solutions Holdings Inc's gross profit for the trailing twelve months (TTM) ended in Sep. 2014 was $169.9 Mil.

Gross Margin is calculated as gross profit divided by its revenue. M/A-COM Technology Solutions Holdings Inc's gross profit for the three months ended in Sep. 2014 was $56.2 Mil. M/A-COM Technology Solutions Holdings Inc's revenue for the three months ended in Sep. 2014 was $114.3 Mil. Therefore, M/A-COM Technology Solutions Holdings Inc's Gross Margin for the quarter that ended in Sep. 2014 was 49.15%.

M/A-COM Technology Solutions Holdings Inc had a gross margin of 49.15% for the quarter that ended in Sep. 2014 => Durable competitive advantage

During the past 6 years, the highest Gross Margin of M/A-COM Technology Solutions Holdings Inc was 44.64%. The lowest was 24.87%. And the median was 41.29%.


Definition

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

M/A-COM Technology Solutions Holdings Inc's Gross Profit for the fiscal year that ended in Sep. 2014 is calculated as

Gross Profit (A: Sep. 2014 )=Revenue - Cost of Goods Sold
=418.662 - 249.674
=169.0

M/A-COM Technology Solutions Holdings Inc's Gross Profit for the quarter that ended in Sep. 2014 is calculated as

Gross Profit (Q: Sep. 2014 )=Revenue - Cost of Goods Sold
=114.317 - 58.128
=56.2

M/A-COM Technology Solutions Holdings Inc Gross Profit for the trailing twelve months (TTM) ended in Sep. 2014 was 36.665 (Dec. 2013 ) + 26.863 (Mar. 2014 ) + 50.214 (Jun. 2014 ) + 56.189 (Sep. 2014 ) = $169.9 Mil.

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

M/A-COM Technology Solutions Holdings Inc'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
=56.2 / 114.317
=49.15 %

* 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

M/A-COM Technology Solutions Holdings Inc had a gross margin of 49.15% for the quarter that ended in Sep. 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.

M/A-COM Technology Solutions Holdings Inc Annual Data

Sep09Sep10Sep11Sep12Sep13Sep14
Gross_Profit 0.00.00.00.025.593.7131.9134.9136.4169.0

M/A-COM Technology Solutions Holdings Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
Gross_Profit 35.431.532.332.835.536.636.726.950.256.2
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