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Marcus & Millichap Inc (NYSE:MMI)
Gross Profit
$254.8 Mil (TTM As of Sep. 2015)

Marcus & Millichap Inc's gross profit for the three months ended in Sep. 2015 was $63.9 Mil. Marcus & Millichap Inc's gross profit for the trailing twelve months (TTM) ended in Sep. 2015 was $254.8 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. 2015 was $63.9 Mil. Marcus & Millichap Inc's revenue for the three months ended in Sep. 2015 was $165.9 Mil. Therefore, Marcus & Millichap Inc's Gross Margin for the quarter that ended in Sep. 2015 was 38.50%.

Marcus & Millichap Inc had a gross margin of 38.50% for the quarter that ended in Sep. 2015 => Competition eroding margins

During the past 5 years, the highest Gross Margin of Marcus & Millichap Inc was 42.98%. The lowest was 38.81%. And the median was 40.31%.


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. 2014 is calculated as

Gross Profit (A: Dec. 2014 )=Revenue - Cost of Goods Sold
=572.188 - 350.102
=222.1

Marcus & Millichap Inc's Gross Profit for the quarter that ended in Sep. 2015 is calculated as

Gross Profit (Q: Sep. 2015 )=Revenue - Cost of Goods Sold
=165.876 - 102.01
=63.9

Marcus & Millichap Inc Gross Profit for the trailing twelve months (TTM) ended in Sep. 2015 was 62.608 (Dec. 2014 ) + 60.383 (Mar. 2015 ) + 67.925 (Jun. 2015 ) + 63.866 (Sep. 2015 ) = $254.8 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. 2015 is calculated as

Gross Margin (Q: Sep. 2015 )=Gross Profit (Q: Sep. 2015 ) / Revenue (Q: Sep. 2015 )
=(Revenue - Cost of Goods Sold) / Revenue
=63.9 / 165.876
=38.50 %

* 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

Marcus & Millichap Inc had a gross margin of 38.50% for the quarter that ended in Sep. 2015 => 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.

Marcus & Millichap Inc Annual Data

Dec10Dec11Dec12Dec13Dec14
Gross_Profit 0.00.00.00.00.093.7112.2155.5171.3222.1

Marcus & Millichap Inc Quarterly Data

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
Gross_Profit 44.044.254.946.254.758.662.660.467.963.9
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