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TIBCO Software Inc (NAS:TIBX)
Gross Profit
\$756 Mil (TTM As of Aug. 2014)

TIBCO Software Inc's gross profit for the three months ended in Aug. 2014 was \$175 Mil. TIBCO Software Inc's gross profit for the trailing twelve months (TTM) ended in Aug. 2014 was \$756 Mil.

Gross Margin is calculated as gross profit divided by its revenue. TIBCO Software Inc's gross profit for the three months ended in Aug. 2014 was \$175 Mil. TIBCO Software Inc's revenue for the three months ended in Aug. 2014 was \$256 Mil. Therefore, TIBCO Software Inc's Gross Margin for the quarter that ended in Aug. 2014 was 68.34%.

TIBCO Software Inc had a gross margin of 68.34% for the quarter that ended in Aug. 2014 => Durable competitive advantage

Definition

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

TIBCO Software Inc's Gross Profit for the fiscal year that ended in Nov. 2013 is calculated as

 Gross Profit (A: Nov. 2013 ) = Revenue - Cost of Goods Sold = 1069.95 - 307.445 = 763

TIBCO Software Inc's Gross Profit for the quarter that ended in Aug. 2014 is calculated as

 Gross Profit (Q: Aug. 2014 ) = Revenue - Cost of Goods Sold = 255.602 - 80.934 = 175

TIBCO Software Inc Gross Profit for the trailing twelve months (TTM) ended in Aug. 2014 was 233.591 (Nov. 2013 ) + 175.347 (Feb. 2014 ) + 172.842 (May. 2014 ) + 174.668 (Aug. 2014 ) = \$756 Mil.

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

TIBCO Software Inc's Gross Margin for the quarter that ended in Aug. 2014 is calculated as

 Gross Margin (Q: Aug. 2014 ) = Gross Profit (Q: Aug. 2014 ) / Revenue (Q: Aug. 2014 ) = (Revenue - Cost of Goods Sold) / Revenue = 175 / 255.602 = 68.34 %

* 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

TIBCO Software Inc had a gross margin of 68.34% for the quarter that ended in Aug. 2014 => Durable competitive advantage

Related Terms

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

TIBCO Software Inc Annual Data

 Nov04 Nov05 Nov06 Nov07 Nov08 Nov09 Nov10 Nov11 Nov12 Nov13 Gross_Profit 294 322 384 418 467 462 556 673 742 763

TIBCO Software Inc Quarterly Data

 May12 Aug12 Nov12 Feb13 May13 Aug13 Nov13 Feb14 May14 Aug14 Gross_Profit 178 183 221 164 172 193 234 175 173 175
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