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Monster Beverage Corp (NAS:MNST)
Gross Profit
$1,251 Mil (TTM As of Jun. 2014)

Monster Beverage Corp's gross profit for the three months ended in Jun. 2014 was $379 Mil. Monster Beverage Corp's gross profit for the trailing twelve months (TTM) ended in Jun. 2014 was $1,251 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Monster Beverage Corp's gross profit for the three months ended in Jun. 2014 was $379 Mil. Monster Beverage Corp's revenue for the three months ended in Jun. 2014 was $687 Mil. Therefore, Monster Beverage Corp's Gross Margin for the quarter that ended in Jun. 2014 was 55.19%.

Monster Beverage Corp had a gross margin of 55.19% for the quarter that ended in Jun. 2014 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Monster Beverage Corp was 53.56%. The lowest was 35.78%. And the median was 46.75%.


Definition

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

Monster Beverage Corp's Gross Profit for the fiscal year that ended in Dec. 2012 is calculated as

Gross Profit (A: Dec. 2012 )=Revenue - Cost of Goods Sold
=2060.702 - 995.046
=1,066

Monster Beverage 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
=687.199 - 307.911
=379

Monster Beverage Corp Gross Profit for the trailing twelve months (TTM) ended in Jun. 2014 was 307.47 (Sep. 2013 ) + 277.16 (Dec. 2013 ) + 286.818 (Mar. 2014 ) + 379.288 (Jun. 2014 ) = $1,251 Mil.

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

Monster Beverage 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
=379 / 687.199
=55.19 %

* 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

Monster Beverage Corp had a gross margin of 55.19% for the quarter that ended in Jun. 2014 => 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.

Monster Beverage Corp Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Gross_Profit 831833174685396126808941,0661,173

Monster Beverage Corp Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
Gross_Profit 241307274244252336307277287379
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