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Marcus & Millichap Inc (NYSE:MMI)
Gross Profit
$278.7 Mil (TTM As of Sep. 2016)

Marcus & Millichap Inc's gross profit for the three months ended in Sep. 2016 was $66.8 Mil. Marcus & Millichap Inc's gross profit for the trailing twelve months (TTM) ended in Sep. 2016 was $278.7 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Marcus & Millichap Inc's gross profit for the three months ended in Sep. 2016 was $66.8 Mil. Marcus & Millichap Inc's revenue for the three months ended in Sep. 2016 was $180.6 Mil. Therefore, Marcus & Millichap Inc's Gross Margin for the quarter that ended in Sep. 2016 was 36.97%.

Marcus & Millichap Inc had a gross margin of 36.97% for the quarter that ended in Sep. 2016 => Competition eroding margins

During the past 6 years, the highest Gross Margin of Marcus & Millichap Inc was 42.98%. The lowest was 38.10%. And the median was 39.80%.


Definition

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

Marcus & Millichap 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
=689.055 - 423.389
=265.7

Marcus & Millichap Inc's Gross Profit for the quarter that ended in Sep. 2016 is calculated as

Gross Profit (Q: Sep. 2016 )=Revenue - Cost of Goods Sold
=180.634 - 113.852
=66.8

Marcus & Millichap Inc Gross Profit for the trailing twelve months (TTM) ended in Sep. 2016 was 73.492 (Dec. 2015 ) + 68.119 (Mar. 2016 ) + 70.261 (Jun. 2016 ) + 66.782 (Sep. 2016 ) = $278.7 Mil.

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

Marcus & Millichap Inc's Gross Margin for the quarter that ended in Sep. 2016 is calculated as

Gross Margin (Q: Sep. 2016 )=Gross Profit (Q: Sep. 2016 ) / Revenue (Q: Sep. 2016 )
=(Revenue - Cost of Goods Sold) / Revenue
=66.8 / 180.634
=36.97 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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

Marcus & Millichap Inc had a gross margin of 36.97% for the quarter that ended in Sep. 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 local exchange's currency.

Marcus & Millichap Inc Annual Data

Dec10Dec11Dec12Dec13Dec14Dec15
Gross_Profit 0.00.00.00.093.7112.2155.5171.3222.1265.7

Marcus & Millichap Inc Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
Gross_Profit 54.758.662.660.467.963.973.568.170.366.8
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