Switch to:
Carnival Corp (NYSE:CCL)
Gross Margin
44.33% (As of Aug. 2014)

Gross Margin is calculated as gross profit divided by its revenue. Carnival Corp's gross profit for the three months ended in Aug. 2014 was $2,193 Mil. Carnival Corp's revenue for the three months ended in Aug. 2014 was $4,947 Mil. Therefore, Carnival Corp's Gross Margin for the quarter that ended in Aug. 2014 was 44.33%.

Warning Sign:

Carnival Corp gross margin has been in long term decline. The average rate of decline per year is -4.1%.

CCL' s 10-Year Gross Margin Range
Min: 25.93   Max: 46.84
Current: 33.46

25.93
46.84

During the past 13 years, the highest Gross Margin of Carnival Corp was 46.84%. The lowest was 25.93%. And the median was 42.06%.

CCL's Gross Marginis ranked lower than
100% of the Companies
in the Global Leisure industry.

( Industry Median: vs. CCL: 33.46 )

Carnival Corp had a gross margin of 44.33% for the quarter that ended in Aug. 2014 => Durable competitive advantage

The 3-Year average Growth Rate of Gross Margin for Carnival Corp was -4.10% per year.


Definition

Gross Margin is the percentage of Gross Profit out of sales or Revenue.

Carnival Corp's Gross Margin for the fiscal year that ended in Nov. 2014 is calculated as

Gross Margin (A: Nov. 2014 )=Gross Profit (A: Nov. 2014 ) / Revenue (A: Nov. 2014 )
=5481 / 15884
=(Revenue - Cost of Goods Sold) / Revenue
=(15884 - 10403) / 15884
=34.51 %

Carnival Corp'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 )
=2193 / 4947
=(Revenue - Cost of Goods Sold) / Revenue
=(4947 - 2754) / 4947
=44.33 %

* 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

Carnival Corp had a gross margin of 44.33% for the quarter that ended in Aug. 2014 => Durable competitive advantage


Be Aware

If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin and Operating Margin closely helps avoid value trap situations.


Related Terms

Operating Margin, Cost of Goods Sold, Gross Profit, Revenue


Historical Data

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

Carnival Corp Annual Data

Nov05Nov06Nov07Nov08Nov09Nov10Nov11Nov12Nov13Nov14
Gross Margin 43.9542.6441.4738.2837.5437.1634.7932.9131.2634.51

Carnival Corp Quarterly Data

May12Aug12Nov12Feb13May13Aug13Nov13Feb14May14Aug14
Gross Margin 29.9644.5628.7027.6628.5138.2828.3527.8129.4044.33
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK