Switch to:
Nabors Industries Ltd (NYSE:NBR)
Gross Profit
$1,420 Mil (TTM As of Dec. 2015)

Nabors Industries Ltd's gross profit for the three months ended in Dec. 2015 was $249 Mil. Nabors Industries Ltd's gross profit for the trailing twelve months (TTM) ended in Dec. 2015 was $1,420 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Nabors Industries Ltd's gross profit for the three months ended in Dec. 2015 was $249 Mil. Nabors Industries Ltd's revenue for the three months ended in Dec. 2015 was $694 Mil. Therefore, Nabors Industries Ltd's Gross Margin for the quarter that ended in Dec. 2015 was 35.83%.

Nabors Industries Ltd had a gross margin of 35.83% for the quarter that ended in Dec. 2015 => Competition eroding margins

During the past 13 years, the highest Gross Margin of Nabors Industries Ltd was 48.00%. The lowest was 33.84%. And the median was 40.13%.

Warning Sign:

Nabors Industries Ltd gross margin has been in long term decline. The average rate of decline per year is -2.8%.


Definition

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

Nabors Industries Ltd'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
=3791.664 - 2371.436
=1,420

Nabors Industries Ltd's Gross Profit for the quarter that ended in Dec. 2015 is calculated as

Gross Profit (Q: Dec. 2015 )=Revenue - Cost of Goods Sold
=693.685 - 445.13
=249

Nabors Industries Ltd Gross Profit for the trailing twelve months (TTM) ended in Dec. 2015 was 502.568 (Mar. 2015 ) + 374.848 (Jun. 2015 ) + 294.257 (Sep. 2015 ) + 248.555 (Dec. 2015 ) = $1,420 Mil.

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

Nabors Industries Ltd's Gross Margin for the quarter that ended in Dec. 2015 is calculated as

Gross Margin (Q: Dec. 2015 )=Gross Profit (Q: Dec. 2015 ) / Revenue (Q: Dec. 2015 )
=(Revenue - Cost of Goods Sold) / Revenue
=249 / 693.685
=35.83 %

* 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

Nabors Industries Ltd had a gross margin of 35.83% for the quarter that ended in Dec. 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.

Nabors Industries Ltd Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
Gross_Profit 2,3182,1762,1931,5521,7742,3802,2502,2672,3051,420

Nabors Industries Ltd Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
Gross_Profit 57452655763159050337529424966
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)

GuruFocus Premium Plus Membership

FEEDBACK