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Tiffany & Co (NYSE:TIF)
Gross Profit
$2,541 Mil (TTM As of Oct. 2014)

Tiffany & Co's gross profit for the three months ended in Oct. 2014 was $571 Mil. Tiffany & Co's gross profit for the trailing twelve months (TTM) ended in Oct. 2014 was $2,541 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Tiffany & Co's gross profit for the three months ended in Oct. 2014 was $571 Mil. Tiffany & Co's revenue for the three months ended in Oct. 2014 was $960 Mil. Therefore, Tiffany & Co's Gross Margin for the quarter that ended in Oct. 2014 was 59.49%.

Tiffany & Co had a gross margin of 59.49% for the quarter that ended in Oct. 2014 => Durable competitive advantage

During the past 13 years, the highest Gross Margin of Tiffany & Co was 61.25%. The lowest was 54.88%. And the median was 57.57%.


Definition

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

Tiffany & Co's Gross Profit for the fiscal year that ended in Jan. 2014 is calculated as

Gross Profit (A: Jan. 2014 )=Revenue - Cost of Goods Sold
=4031.13 - 1690.687
=2,340

Tiffany & Co's Gross Profit for the quarter that ended in Oct. 2014 is calculated as

Gross Profit (Q: Oct. 2014 )=Revenue - Cost of Goods Sold
=959.589 - 388.718
=571

Tiffany & Co Gross Profit for the trailing twelve months (TTM) ended in Oct. 2014 was 785.609 (Jan. 2014 ) + 589.526 (Apr. 2014 ) + 595.163 (Jul. 2014 ) + 570.871 (Oct. 2014 ) = $2,541 Mil.

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

Tiffany & Co's Gross Margin for the quarter that ended in Oct. 2014 is calculated as

Gross Margin (Q: Oct. 2014 )=Gross Profit (Q: Oct. 2014 ) / Revenue (Q: Oct. 2014 )
=(Revenue - Cost of Goods Sold) / Revenue
=571 / 959.589
=59.49 %

* 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

Tiffany & Co had a gross margin of 59.49% for the quarter that ended in Oct. 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.

Tiffany & Co Annual Data

Jan05Jan06Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14
Gross_Profit 1,2311,3421,4761,6301,6451,5301,8222,1512,1632,340

Tiffany & Co Quarterly Data

Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14
Gross_Profit 499464731503532519786590595571
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