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GuruFocus has detected 2 Warning Signs with Finisar Corp $FNSR.
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Finisar Corp (NAS:FNSR)
COGS-to-Revenue
0.64 (As of Jan. 2017)

Finisar Corp's cost of goods sold for the three months ended in Jan. 2017 was $244 Mil. Its revenue for the three months ended in Jan. 2017 was $381 Mil.

Finisar Corp's COGS to Revenue for the three months ended in Jan. 2017 was 0.64.

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin. Finisar Corp's Gross Margin for the three months ended in Jan. 2017 was 35.90%.


Definition

Finisar Corp's COGS to Revenue for the fiscal year that ended in Apr. 2016 is calculated as

COGS to Revenue=Cost of Goods Sold / Revenue
=908.516 / 1263.166
=0.72

Finisar Corp's COGS to Revenue for the quarter that ended in Jan. 2017 is calculated as

COGS to Revenue=Cost of Goods Sold / Revenue
=243.951 / 380.588
=0.64

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


Explanation

Cost of Goods Sold is directly linked to profitability of the company through Gross Margin.

Finisar Corp's Gross Margin for the three months ended in Jan. 2017 is calculated as:

Gross Margin=1 - COGS to Revenue
=1 - Cost of Goods Sold / Revenue
=1 - 243.951 / 380.588
=35.90 %

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

A company that has a “moat” can usually maintain or even expand their Gross Margin. A company can increase its Gross Margin in two ways. It can increase the prices of the goods it sells and keeps its Cost of Goods Sold unchanged. Or it can keep the sales price unchanged and squeeze its suppliers to reduce the Cost of Goods Sold. Warren Buffett believes businesses with the power to raise prices have “moats”.


Related Terms

Cost of Goods Sold, Gross Margin, Revenue


Historical Data

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

Finisar Corp Annual Data

Apr07Apr08Apr09Apr10Apr11Apr12Apr13Apr14Apr15Apr16
cogs2rev 0.660.680.720.710.670.710.720.660.720.72

Finisar Corp Quarterly Data

Oct14Jan15Apr15Jul15Oct15Jan16Apr16Jul16Oct16Jan17
cogs2rev 0.710.750.720.720.720.720.720.680.640.64
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