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EchoStar Corp (NAS:SATS)
Gross Profit
$1,109 Mil (TTM As of Mar. 2014)

EchoStar Corp's gross profit for the three months ended in Mar. 2014 was $295 Mil. EchoStar Corp's gross profit for the trailing twelve months (TTM) ended in Mar. 2014 was $1,109 Mil.

Gross Margin is calculated as gross profit divided by its revenue. EchoStar Corp's gross profit for the three months ended in Mar. 2014 was $295 Mil. EchoStar Corp's revenue for the three months ended in Mar. 2014 was $826 Mil. Therefore, EchoStar Corp's Gross Margin for the quarter that ended in Mar. 2014 was 35.74%.

EchoStar Corp had a gross margin of 35.74% for the quarter that ended in Mar. 2014 => Competition eroding margins

During the past 8 years, the highest Gross Margin of EchoStar Corp was 33.07%. The lowest was 5.98%. And the median was 23.86%.


Definition

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

EchoStar Corp's Gross Profit for the fiscal year that ended in Dec. 2013 is calculated as

Gross Profit (A: Dec. 2013 )=Revenue - Cost of Goods Sold
=3282.452 - 2206.898
=1,076

EchoStar Corp's Gross Profit for the quarter that ended in Mar. 2014 is calculated as

Gross Profit (Q: Mar. 2014 )=Revenue - Cost of Goods Sold
=826.023 - 530.763
=295

EchoStar Corp Gross Profit for the trailing twelve months (TTM) ended in Mar. 2014 was 275.636 (Jun. 2013 ) + 266.975 (Sep. 2013 ) + 270.638 (Dec. 2013 ) + 295.26 (Mar. 2014 ) = $1,109 Mil.

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

EchoStar Corp's Gross Margin for the quarter that ended in Mar. 2014 is calculated as

Gross Margin (Q: Mar. 2014 )=Gross Profit (Q: Mar. 2014 ) / Revenue (Q: Mar. 2014 )
=(Revenue - Cost of Goods Sold) / Revenue
=295 / 826.023
=35.74 %

* 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

EchoStar Corp had a gross margin of 35.74% for the quarter that ended in Mar. 2014 => 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.

EchoStar Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Gross_Profit 000924354335618541,0321,076

EchoStar Corp Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
Gross_Profit 281260269247256262276267271295
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