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Equifax Inc (NYSE:EFX)
Gross Profit
$1,815 Mil (TTM As of Mar. 2016)

Equifax Inc's gross profit for the three months ended in Mar. 2016 was $475 Mil. Equifax Inc's gross profit for the trailing twelve months (TTM) ended in Mar. 2016 was $1,815 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Equifax Inc's gross profit for the three months ended in Mar. 2016 was $475 Mil. Equifax Inc's revenue for the three months ended in Mar. 2016 was $728 Mil. Therefore, Equifax Inc's Gross Margin for the quarter that ended in Mar. 2016 was 65.22%.

Equifax Inc had a gross margin of 65.22% for the quarter that ended in Mar. 2016 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Equifax Inc was 66.68%. The lowest was 57.92%. And the median was 60.28%.


Definition

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

Equifax Inc's Gross Profit for the fiscal year that ended in Dec. 2015 is calculated as

Gross Profit (A: Dec. 2015 )=Revenue - Cost of Goods Sold
=2663.6 - 887.4
=1,776

Equifax Inc's Gross Profit for the quarter that ended in Mar. 2016 is calculated as

Gross Profit (Q: Mar. 2016 )=Revenue - Cost of Goods Sold
=728.3 - 253.3
=475

Equifax Inc Gross Profit for the trailing twelve months (TTM) ended in Mar. 2016 was 457.3 (Jun. 2015 ) + 440.9 (Sep. 2015 ) + 441.3 (Dec. 2015 ) + 475 (Mar. 2016 ) = $1,815 Mil.

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

Equifax Inc's Gross Margin for the quarter that ended in Mar. 2016 is calculated as

Gross Margin (Q: Mar. 2016 )=Gross Profit (Q: Mar. 2016 ) / Revenue (Q: Mar. 2016 )
=(Revenue - Cost of Goods Sold) / Revenue
=475 / 728.3
=65.22 %

* 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

Equifax Inc had a gross margin of 65.22% for the quarter that ended in Mar. 2016 => 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.

Equifax Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
Gross_Profit 9201,0911,1571,0571,1001,1911,3311,5171,5921,776

Equifax Inc Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
Gross_Profit 381378402402410437457441441475
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