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GuruFocus has detected 4 Warning Signs with Adobe Systems Inc $ADBE.
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Adobe Systems Inc (NAS:ADBE)
COGS-to-Revenue
0.14 (As of Feb. 2017)

Adobe Systems Inc's cost of goods sold for the three months ended in Feb. 2017 was $237 Mil. Its revenue for the three months ended in Feb. 2017 was $1,682 Mil.

Adobe Systems Inc's COGS to Revenue for the three months ended in Feb. 2017 was 0.14.

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin. Adobe Systems Inc's Gross Margin for the three months ended in Feb. 2017 was 85.89%.


Definition

Adobe Systems Inc's COGS to Revenue for the fiscal year that ended in Nov. 2016 is calculated as

COGS to Revenue=Cost of Goods Sold / Revenue
=819.908 / 5854.43
=0.14

Adobe Systems Inc's COGS to Revenue for the quarter that ended in Feb. 2017 is calculated as

COGS to Revenue=Cost of Goods Sold / Revenue
=237.337 / 1681.646
=0.14

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Explanation

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin.

Adobe Systems Inc's Gross Margin for the three months ended in Feb. 2017 is calculated as:

Gross Margin=1 - COGS to Revenue
=1 - Cost of Goods Sold / Revenue
=1 - 237.337 / 1681.646
=85.89 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

A company that has a “moat” can usually maintain or even expand their Gross Margin. A company can increase its Gross Margin in two ways. It can increase the prices of the goods it sells and keeps its Cost of Goods Sold unchanged. Or it can keep the sales price unchanged and squeeze its suppliers to reduce the Cost of Goods Sold. Warren Buffett believes businesses with the power to raise prices have “moats”.


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.

Adobe Systems Inc Annual Data

Nov07Nov08Nov09Nov10Nov11Nov12Nov13Nov14Nov15Nov16
cogs2rev 0.110.100.100.110.100.110.140.150.160.14

Adobe Systems Inc Quarterly Data

Nov14Feb15May15Aug15Nov15Feb16May16Aug16Nov16Feb17
cogs2rev 0.150.150.160.160.150.140.140.140.130.14
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