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B/E Aerospace Inc (NAS:BEAV)
Gross Profit
$1,466 Mil (TTM As of Jun. 2014)

B/E Aerospace Inc's gross profit for the three months ended in Jun. 2014 was $407 Mil. B/E Aerospace Inc's gross profit for the trailing twelve months (TTM) ended in Jun. 2014 was $1,466 Mil.

Gross Margin is calculated as gross profit divided by its revenue. B/E Aerospace Inc's gross profit for the three months ended in Jun. 2014 was $407 Mil. B/E Aerospace Inc's revenue for the three months ended in Jun. 2014 was $1,090 Mil. Therefore, B/E Aerospace Inc's Gross Margin for the quarter that ended in Jun. 2014 was 37.32%.

B/E Aerospace Inc had a gross margin of 37.32% for the quarter that ended in Jun. 2014 => Competition eroding margins

During the past 13 years, the highest Gross Margin of B/E Aerospace Inc was 39.30%. The lowest was 22.10%. And the median was 34.78%.


Definition

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

B/E Aerospace Inc's Gross Profit for the fiscal year that ended in Dec. 2013 is calculated as

Gross Profit (A: Dec. 2013 )=Revenue - Cost of Goods Sold
=3483.7 - 2154.8
=1,329

B/E Aerospace Inc's Gross Profit for the quarter that ended in Jun. 2014 is calculated as

Gross Profit (Q: Jun. 2014 )=Revenue - Cost of Goods Sold
=1089.5 - 682.9
=407

B/E Aerospace Inc Gross Profit for the trailing twelve months (TTM) ended in Jun. 2014 was 342.3 (Sep. 2013 ) + 340.7 (Dec. 2013 ) + 376.7 (Mar. 2014 ) + 406.6 (Jun. 2014 ) = $1,466 Mil.

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

B/E Aerospace Inc's Gross Margin for the quarter that ended in Jun. 2014 is calculated as

Gross Margin (Q: Jun. 2014 )=Gross Profit (Q: Jun. 2014 ) / Revenue (Q: Jun. 2014 )
=(Revenue - Cost of Goods Sold) / Revenue
=407 / 1089.5
=37.32 %

* 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

B/E Aerospace Inc had a gross margin of 37.32% for the quarter that ended in Jun. 2014 => 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.

B/E Aerospace Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Gross_Profit 2392963975707246697219361,1641,329

B/E Aerospace Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
Gross_Profit 284293288299319327342341377407
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