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Barnes & Noble Inc (NYSE:BKS)
Gross Profit
$1,860 Mil (TTM As of Jan. 2016)

Barnes & Noble Inc's gross profit for the three months ended in Jan. 2016 was $492 Mil. Barnes & Noble Inc's gross profit for the trailing twelve months (TTM) ended in Jan. 2016 was $1,860 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Barnes & Noble Inc's gross profit for the three months ended in Jan. 2016 was $492 Mil. Barnes & Noble Inc's revenue for the three months ended in Jan. 2016 was $1,414 Mil. Therefore, Barnes & Noble Inc's Gross Margin for the quarter that ended in Jan. 2016 was 34.77%.

Barnes & Noble Inc had a gross margin of 34.77% for the quarter that ended in Jan. 2016 => Competition eroding margins

During the past 13 years, the highest Gross Margin of Barnes & Noble Inc was 31.14%. The lowest was 24.60%. And the median was 29.72%.


Definition

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

Barnes & Noble Inc's Gross Profit for the fiscal year that ended in Apr. 2015 is calculated as

Gross Profit (A: Apr. 2015 )=Revenue - Cost of Goods Sold
=6069.497 - 4196.998
=1,872

Barnes & Noble Inc's Gross Profit for the quarter that ended in Jan. 2016 is calculated as

Gross Profit (Q: Jan. 2016 )=Revenue - Cost of Goods Sold
=1413.947 - 922.292
=492

Barnes & Noble Inc Gross Profit for the trailing twelve months (TTM) ended in Jan. 2016 was 746.382 (Apr. 2015 ) + 352.385 (Jul. 2015 ) + 269.786 (Oct. 2015 ) + 491.655 (Jan. 2016 ) = $1,860 Mil.

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

Barnes & Noble Inc's Gross Margin for the quarter that ended in Jan. 2016 is calculated as

Gross Margin (Q: Jan. 2016 )=Gross Profit (Q: Jan. 2016 ) / Revenue (Q: Jan. 2016 )
=(Revenue - Cost of Goods Sold) / Revenue
=492 / 1413.947
=34.77 %

* 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

Barnes & Noble Inc had a gross margin of 34.77% for the quarter that ended in Jan. 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.

Barnes & Noble Inc Annual Data

Jan06Jan07Jan08Jan09Apr10Apr11Apr12Apr13Apr14Apr15
Gross_Profit 1,5701,6381,6411,5811,6771,7931,9111,6831,8581,872

Barnes & Noble Inc Quarterly Data

Oct13Jan14Apr14Jul14Oct14Jan15Apr15Jul15Oct15Jan16
Gross_Profit 462603424383286506746352270492
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