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Qualcomm Inc  (NAS:QCOM) Gross Profit: $12,499 Mil (TTM As of Sep. 2017)

Qualcomm Inc's gross profit for the three months ended in Sep. 2017 was $3,252 Mil. Qualcomm Inc's gross profit for the trailing twelve months (TTM) ended in Sep. 2017 was $12,499 Mil.

Gross Margin % is calculated as gross profit divided by its revenue. Qualcomm Inc's gross profit for the three months ended in Sep. 2017 was $3,252 Mil. Qualcomm Inc's Revenue for the three months ended in Sep. 2017 was $5,904 Mil. Therefore, Qualcomm Inc's Gross Margin % for the quarter that ended in Sep. 2017 was 55.08%.

Qualcomm Inc had a gross margin of 55.08% for the quarter that ended in Sep. 2017 => Durable competitive advantage

During the past 13 years, the highest Gross Margin % of Qualcomm Inc was 69.94%. The lowest was 56.07%. And the median was 61.70%.

Warning Sign:

Qualcomm Inc gross margin has been in long term decline. The average rate of decline per year is -1.9%.


Historical Data

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

* Premium members only.

Qualcomm Inc Annual Data

Sep08 Sep09 Sep10 Sep11 Sep12 Sep13 Sep14 Sep15 Sep16 Sep17
Gross Profit Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 15,046.00 15,801.00 14,903.00 13,805.00 12,499.00

Qualcomm Inc Quarterly Data

Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
Gross Profit Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 3,645.00 3,556.00 2,808.00 2,883.00 3,252.00

Competitive Comparison
* 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.


Calculation

Gross Profit is the different between the sale prices and the cost of buying or producing the goods.

Qualcomm Inc's Gross Profit for the fiscal year that ended in Sep. 2017 is calculated as

Gross Profit (A: Sep. 2017 )=Revenue - Cost of Goods Sold
=22291 - 9792
=12,499

Qualcomm Inc's Gross Profit for the quarter that ended in Sep. 2017 is calculated as

Gross Profit (Q: Sep. 2017 )=Revenue - Cost of Goods Sold
=5904 - 2652
=3,252

Gross Profit for the trailing twelve months (TTM) ended in Sep. 2017 was 3556 (Dec. 2016 ) + 2808 (Mar. 2017 ) + 2883 (Jun. 2017 ) + 3252 (Sep. 2017 ) = $12,499 Mil.

Gross Profit is the numerator in the calculation of Gross Margin:

Qualcomm Inc's Gross Margin % for the quarter that ended in Sep. 2017 is calculated as

Gross Margin % (Q: Sep. 2017 )=Gross Profit (Q: Sep. 2017 ) / Revenue (Q: Sep. 2017 )
=(Revenue - Cost of Goods Sold) / Revenue
=3,252 / 5904
=55.08 %

* 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

Qualcomm Inc had a gross margin of 55.08% for the quarter that ended in Sep. 2017 => Durable competitive advantage


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