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Agilent Technologies Inc (NYSE:A)
Gross Profit
$2,804 Mil (TTM As of Apr. 2015)

Agilent Technologies Inc's gross profit for the three months ended in Apr. 2015 was $480 Mil. Agilent Technologies Inc's gross profit for the trailing twelve months (TTM) ended in Apr. 2015 was $2,804 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Agilent Technologies Inc's gross profit for the three months ended in Apr. 2015 was $480 Mil. Agilent Technologies Inc's revenue for the three months ended in Apr. 2015 was $963 Mil. Therefore, Agilent Technologies Inc's Gross Margin for the quarter that ended in Apr. 2015 was 49.84%.

Agilent Technologies Inc had a gross margin of 49.84% for the quarter that ended in Apr. 2015 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Agilent Technologies Inc was 55.35%. The lowest was 38.54%. And the median was 51.15%.


Definition

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

Agilent Technologies Inc's Gross Profit for the fiscal year that ended in Oct. 2014 is calculated as

Gross Profit (A: Oct. 2014 )=Revenue - Cost of Goods Sold
=6981 - 3388
=3,593

Agilent Technologies Inc's Gross Profit for the quarter that ended in Apr. 2015 is calculated as

Gross Profit (Q: Apr. 2015 )=Revenue - Cost of Goods Sold
=963 - 483
=480

Agilent Technologies Inc Gross Profit for the trailing twelve months (TTM) ended in Apr. 2015 was 914 (Jul. 2014 ) + 897 (Oct. 2014 ) + 513 (Jan. 2015 ) + 480 (Apr. 2015 ) = $2,804 Mil.

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

Agilent Technologies Inc's Gross Margin for the quarter that ended in Apr. 2015 is calculated as

Gross Margin (Q: Apr. 2015 )=Gross Profit (Q: Apr. 2015 ) / Revenue (Q: Apr. 2015 )
=(Revenue - Cost of Goods Sold) / Revenue
=480 / 963
=49.84 %

* 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

Agilent Technologies Inc had a gross margin of 49.84% for the quarter that ended in Apr. 2015 => 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.

Agilent Technologies Inc Annual Data

Oct05Oct06Oct07Oct08Oct09Oct10Oct11Oct12Oct13Oct14
Gross_Profit 2,3642,6582,9693,1962,2922,9303,5293,6043,5353,593

Agilent Technologies Inc Quarterly Data

Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14Jan15Apr15
Gross_Profit 880891856908510485914897513480
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