Switch to:
Novo Nordisk A/S (NYSE:NVO)
Gross Profit
$14,055 Mil (TTM As of Sep. 2016)

Novo Nordisk A/S's gross profit for the three months ended in Sep. 2016 was $3,547 Mil. Novo Nordisk A/S's gross profit for the trailing twelve months (TTM) ended in Sep. 2016 was $14,055 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Novo Nordisk A/S's gross profit for the three months ended in Sep. 2016 was $3,547 Mil. Novo Nordisk A/S's revenue for the three months ended in Sep. 2016 was $4,148 Mil. Therefore, Novo Nordisk A/S's Gross Margin for the quarter that ended in Sep. 2016 was 85.52%.

Novo Nordisk A/S had a gross margin of 85.52% for the quarter that ended in Sep. 2016 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Novo Nordisk A/S was 85.00%. The lowest was 75.26%. And the median was 80.91%.


Definition

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

Novo Nordisk A/S'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
=15748.8691084 - 2362.17714869
=13,387

Novo Nordisk A/S's Gross Profit for the quarter that ended in Sep. 2016 is calculated as

Gross Profit (Q: Sep. 2016 )=Revenue - Cost of Goods Sold
=4147.76321735 - 600.391625245
=3,547

Novo Nordisk A/S Gross Profit for the trailing twelve months (TTM) ended in Sep. 2016 was 3541.22282212 (Dec. 2015 ) + 3430.26901144 (Mar. 2016 ) + 3536.32381815 (Jun. 2016 ) + 3547.37159211 (Sep. 2016 ) = $14,055 Mil.

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

Novo Nordisk A/S'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
=3,547 / 4147.76321735
=85.52 %

* 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

Novo Nordisk A/S had a gross margin of 85.52% for the quarter that ended in Sep. 2016 => 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 local exchange's currency.

Novo Nordisk A/S Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
Gross_Profit 5,1666,2616,4327,9598,7109,51111,35412,75912,30213,387

Novo Nordisk A/S Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
Gross_Profit 3,2733,2593,4113,0933,4913,4533,5413,4303,5363,547
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)
FEEDBACK