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E.I. du Pont de Nemours & Company (NYSE:DD)
Gross Profit
$12,684 Mil (TTM As of Dec. 2013)

E.I. du Pont de Nemours & Company's gross profit for the three months ended in Dec. 2013 was $2,703 Mil. E.I. du Pont de Nemours & Company's gross profit for the trailing twelve months (TTM) ended in Dec. 2013 was $12,684 Mil.

Gross Margin is calculated as gross profit divided by its revenue. E.I. du Pont de Nemours & Company's gross profit for the three months ended in Dec. 2013 was $2,703 Mil. E.I. du Pont de Nemours & Company's revenue for the three months ended in Dec. 2013 was $7,836 Mil. Therefore, E.I. du Pont de Nemours & Company's Gross Margin for the quarter that ended in Dec. 2013 was 34.49%.

E.I. du Pont de Nemours & Company had a gross margin of 34.49% for the quarter that ended in Dec. 2013 => Competition eroding margins

During the past 13 years, the highest Gross Margin of E.I. du Pont de Nemours & Company was 39.00%. The lowest was 25.14%. And the median was 32.50%.


Definition

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

E.I. du Pont de Nemours & Company'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
=36144 - 22548
=13,596

E.I. du Pont de Nemours & Company's Gross Profit for the quarter that ended in Dec. 2013 is calculated as

Gross Profit (Q: Dec. 2013 )=Revenue - Cost of Goods Sold
=7836 - 5133
=2,703

E.I. du Pont de Nemours & Company Gross Profit for the trailing twelve months (TTM) ended in Dec. 2013 was 3395 (Mar. 2013 ) + 3946 (Jun. 2013 ) + 2640 (Sep. 2013 ) + 2703 (Dec. 2013 ) = $12,684 Mil.

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

E.I. du Pont de Nemours & Company's Gross Margin for the quarter that ended in Dec. 2013 is calculated as

Gross Margin (Q: Dec. 2013 )=Gross Profit (Q: Dec. 2013 ) / Revenue (Q: Dec. 2013 )
=(Revenue - Cost of Goods Sold) / Revenue
=2,703 / 7836
=34.49 %

* 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

E.I. du Pont de Nemours & Company had a gross margin of 34.49% for the quarter that ended in Dec. 2013 => 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.

E.I. du Pont de Nemours & Company Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Gross_Profit 7,5798,8088,5427,6328,2887,6208,3259,54913,77213,596

E.I. du Pont de Nemours & Company Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Gross_Profit 1,9581,7543,3784,3642,5572,5923,3953,9462,6402,703
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