Gross Margin % is calculated as gross profit divided by its revenue. Darden Restaurants's Gross Profit for the
three
months ended in Feb. 2024 was $646 Mil. Darden Restaurants's Revenue for the
three
months ended in Feb. 2024 was $2,975 Mil. Therefore, Darden Restaurants's Gross Margin % for the quarter that ended in Feb. 2024 was 21.70%.
Warning Sign:
Darden Restaurants Inc gross margin has been in long-term decline. The average rate of decline per year is -1.2%.
The historical rank and industry rank for Darden Restaurants's Gross Margin % or its related term are showing as below:
DRI'
s Gross Margin % Range Over the Past 10 Years
Min: 18.04 Med: 20.89 Max: 22.23
Current: 21.03
During the past 13 years, the highestGross Margin % of Darden Restaurants was 22.23%. The lowest was 18.04%. And the median was 20.89%.
DRI's Gross Margin % is ranked worse than 84.84% of 343
companies
in the Restaurants industry
Industry Median: 46.87
vs DRI: 21.03
Darden Restaurants had a gross margin of 21.70% for the quarter that ended in Feb. 2024 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for Darden Restaurants was -1.20% per year.
Darden Restaurants Gross Margin % Historical Data
The historical data trend for Darden Restaurants's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
* Premium members only.
Darden Restaurants Annual Data
Trend
May14
May15
May16
May17
May18
May19
May20
May21
May22
May23
Gross Margin %
21.73
18.04
20.75
20.72
19.86
Darden Restaurants Quarterly Data
May19
Aug19
Nov19
Feb20
May20
Aug20
Nov20
Feb21
May21
Aug21
Nov21
Feb22
May22
Aug22
Nov22
Feb23
May23
Aug23
Nov23
Feb24
Gross Margin %
20.99
21.76
20.42
20.17
21.70
Competitive Comparison
For the Restaurants subindustry, Darden Restaurants's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Darden Restaurants Gross Margin % Distribution
For the Restaurants industry and Consumer Cyclical sector, Darden Restaurants's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Darden Restaurants's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange 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.
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
Darden Restaurants had a gross margin of 21.70% for the quarter that ended in Feb. 2024 => Competition eroding margins
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.
Darden Restaurants Gross Margin % Related Terms
Thank you for viewing the detailed overview of Darden Restaurants's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Darden Restaurants (Darden Restaurants) Business Description
Darden Restaurants is the largest restaurant operator in the U.S. full-service space, with consolidated revenue of $10.5 billion in fiscal 2023 resulting in 3%-4% full-service market share (per NRA data and our calculations). The company maintains a portfolio of 10 restaurant brands: Olive Garden, LongHorn Steakhouse, Cheddar's Scratch Kitchen, Ruth's Chris, Yard House, The Capital Grille, Seasons 52, Eddie V's, Bahama Breeze, and The Capital Burger. Darden generates revenue almost exclusively from company-owned restaurants, though a small network of franchised restaurants and consumer-packaged goods sales through the traditional grocery channel contribute modestly. As of the end of its fiscal 2023, the company operated 1,914 restaurants in the U.S.
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