Mentor Graphics (Mentor Graphics) Gross Margin % : 89.43% (As of Jan. 2017)

Mentor Graphics Gross Margin % Chart

Mentor Graphics Annual Data
	Trend	Jan08	Jan09	Jan10	Jan11	Jan12	Jan13	Jan14	Jan15	Jan16	Jan17
Gross Margin %		Get a 7-Day Free Trial					82.58	83.82	83.58	83.94	84.86

Mentor Graphics Quarterly Data
	Apr12	Jul12	Oct12	Jan13	Apr13	Jul13	Oct13	Jan14	Apr14	Jul14	Oct14	Jan15	Apr15	Jul15	Oct15	Jan16	Apr16	Jul16	Oct16	Jan17
Gross Margin %	Get a 7-Day Free Trial															85.93	81.17	80.49	84.13	89.43

Competitive Comparison of Mentor Graphics's Gross Margin %

For the Software - Application subindustry, Mentor Graphics'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.

Mentor Graphics's Gross Margin % Distribution in the Software Industry

For the Software industry and Technology sector, Mentor Graphics's Gross Margin % distribution charts can be found below:

* The bar in red indicates where Mentor Graphics's Gross Margin % falls into.

Mentor Graphics Gross Margin % Calculation

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

Mentor Graphics's Gross Margin for the fiscal year that ended in Jan. 2017 is calculated as

Mentor Graphics's Gross Margin for the quarter that ended in Jan. 2017 is calculated as

* 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.

Mentor Graphics  (NAS:MENT) Gross Margin % 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

Mentor Graphics had a gross margin of 89.43% for the quarter that ended in Jan. 2017 => 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.

Mentor Graphics Gross Margin % Related Terms

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Mentor Graphics (Mentor Graphics) Business Description