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Carnival Corp (NYSE:CCL)
Gross Margin
49.72% (As of Aug. 2016)

Gross Margin is calculated as gross profit divided by its revenue. Carnival Corp's gross profit for the three months ended in Aug. 2016 was $2,534 Mil. Carnival Corp's revenue for the three months ended in Aug. 2016 was $5,097 Mil. Therefore, Carnival Corp's Gross Margin for the quarter that ended in Aug. 2016 was 49.72%.

CCL' s Gross Margin Range Over the Past 10 Years
Min: 31.13   Max: 42.64
Current: 42.58

31.13
42.64

During the past 13 years, the highest Gross Margin of Carnival Corp was 42.64%. The lowest was 31.13%. And the median was 37.35%.

CCL's Gross Margin is ranked lower than
58% of the 871 Companies
in the Global Leisure industry.

( Industry Median: 49.36 vs. CCL: 42.58 )

Carnival Corp had a gross margin of 49.72% for the quarter that ended in Aug. 2016 => Durable competitive advantage

The 5-Year average Growth Rate of Gross Margin for Carnival Corp was 0.80% 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. 2015 is calculated as

Gross Margin (A: Nov. 2015 )=Gross Profit (A: Nov. 2015 ) / Revenue (A: Nov. 2015 )
=6267 / 15714
=(Revenue - Cost of Goods Sold) / Revenue
=(15714 - 9447) / 15714
=39.88 %

Carnival Corp's Gross Margin for the quarter that ended in Aug. 2016 is calculated as

Gross Margin (Q: Aug. 2016 )=Gross Profit (Q: Aug. 2016 ) / Revenue (Q: Aug. 2016 )
=2534 / 5097
=(Revenue - Cost of Goods Sold) / Revenue
=(5097 - 2563) / 5097
=49.72 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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 49.72% for the quarter that ended in Aug. 2016 => 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 local exchange's currency.

Carnival Corp Annual Data

Nov06Nov07Nov08Nov09Nov10Nov11Nov12Nov13Nov14Nov15
Gross Margin 42.6441.4738.2837.5437.1634.7932.9131.1334.3939.88

Carnival Corp Quarterly Data

May14Aug14Nov14Feb15May15Aug15Nov15Feb16May16Aug16
Gross Margin 29.2044.2132.8333.8733.0449.0140.2338.5639.0649.72
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