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Liberty Interactive Corp (NAS:LINTA)
Gross Profit
\$4,825 Mil (TTM As of Jun. 2014)

Liberty Interactive Corp's gross profit for the three months ended in Jun. 2014 was \$1,250 Mil. Liberty Interactive Corp's gross profit for the trailing twelve months (TTM) ended in Jun. 2014 was \$4,825 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Liberty Interactive Corp's gross profit for the three months ended in Jun. 2014 was \$1,250 Mil. Liberty Interactive Corp's revenue for the three months ended in Jun. 2014 was \$2,818 Mil. Therefore, Liberty Interactive Corp's Gross Margin for the quarter that ended in Jun. 2014 was 44.36%.

Liberty Interactive Corp had a gross margin of 44.36% for the quarter that ended in Jun. 2014 => Durable competitive advantage

During the past 9 years, the highest Gross Margin of Liberty Interactive Corp was 41.33%. The lowest was 26.08%. And the median was 28.75%.

Definition

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

Liberty Interactive Corp'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 = 11252 - 6602 = 4,650

Liberty Interactive Corp's Gross Profit for the quarter that ended in Jun. 2014 is calculated as

 Gross Profit (Q: Jun. 2014 ) = Revenue - Cost of Goods Sold = 2818 - 1568 = 1,250

Liberty Interactive Corp Gross Profit for the trailing twelve months (TTM) ended in Jun. 2014 was 1063 (Sep. 2013 ) + 1350 (Dec. 2013 ) + 1162 (Mar. 2014 ) + 1250 (Jun. 2014 ) = \$4,825 Mil.

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

Liberty Interactive Corp'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 = 1,250 / 2818 = 44.36 %

* 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

Liberty Interactive Corp had a gross margin of 44.36% for the quarter that ended in Jun. 2014 => Durable competitive advantage

Related Terms

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Liberty Interactive Corp Annual Data

 Dec05 Dec06 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Gross_Profit 0 1,819 2,165 2,243 2,107 2,221 2,428 3,502 3,658 4,650

Liberty Interactive Corp Quarterly Data

 Mar12 Jun12 Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Gross_Profit 848 877 789 1,144 1,111 1,126 1,063 1,350 1,162 1,250
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