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Wal-Mart Stores Inc (NYSE:WMT)
Gross Profit
$120,565 Mil (TTM As of Jan. 2015)

Wal-Mart Stores Inc's gross profit for the three months ended in Jan. 2015 was $32,450 Mil. Wal-Mart Stores Inc's gross profit for the trailing twelve months (TTM) ended in Jan. 2015 was $120,565 Mil.

Gross Margin is calculated as gross profit divided by its revenue. Wal-Mart Stores Inc's gross profit for the three months ended in Jan. 2015 was $32,450 Mil. Wal-Mart Stores Inc's revenue for the three months ended in Jan. 2015 was $131,565 Mil. Therefore, Wal-Mart Stores Inc's Gross Margin for the quarter that ended in Jan. 2015 was 24.66%.

Wal-Mart Stores Inc had a gross margin of 24.66% for the quarter that ended in Jan. 2015 => Competition eroding margins

During the past 13 years, the highest Gross Margin of Wal-Mart Stores Inc was 25.37%. The lowest was 21.75%. And the median was 23.80%.


Definition

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

Wal-Mart Stores Inc's Gross Profit for the fiscal year that ended in Jan. 2015 is calculated as

Gross Profit (A: Jan. 2015 )=Revenue - Cost of Goods Sold
=485651 - 365086
=120,565

Wal-Mart Stores Inc's Gross Profit for the quarter that ended in Jan. 2015 is calculated as

Gross Profit (Q: Jan. 2015 )=Revenue - Cost of Goods Sold
=131565 - 99115
=32,450

Wal-Mart Stores Inc Gross Profit for the trailing twelve months (TTM) ended in Jan. 2015 was 28246 (Apr. 2014 ) + 30115 (Jul. 2014 ) + 29754 (Oct. 2014 ) + 32450 (Jan. 2015 ) = $120,565 Mil.

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

Wal-Mart Stores Inc's Gross Margin for the quarter that ended in Jan. 2015 is calculated as

Gross Margin (Q: Jan. 2015 )=Gross Profit (Q: Jan. 2015 ) / Revenue (Q: Jan. 2015 )
=(Revenue - Cost of Goods Sold) / Revenue
=32,450 / 131565
=24.66 %

* 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

Wal-Mart Stores Inc had a gross margin of 24.66% for the quarter that ended in Jan. 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.

Wal-Mart Stores Inc Annual Data

Jan06Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15
Gross_Profit 74,45284,38992,126100,318103,557106,562111,823116,674118,225120,565

Wal-Mart Stores Inc Quarterly Data

Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14Jan15
Gross_Profit 28,41231,79128,16029,49029,00131,73528,24630,11529,75432,450
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