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CFLT (Confluent) Degree of Operating Leverage : -0.13 (As of Mar. 2025)


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What is Confluent Degree of Operating Leverage?

Degree of Operating Leverage (DOL) measures the percentage change in EBIT for a unit change in Revenue. Confluent's Degree of Operating Leverage for the quarter that ended in Mar. 2025 was -0.13. The higher Degree of Operating Leverage, the higher operating risk the company will take.

The industry rank for Confluent's Degree of Operating Leverage or its related term are showing as below:

CFLT's Degree of Operating Leverage is ranked better than
62.97% of 2663 companies
in the Software industry
Industry Median: 0.79 vs CFLT: -0.13

Confluent Degree of Operating Leverage Historical Data

The historical data trend for Confluent's Degree of Operating Leverage 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.

Confluent Degree of Operating Leverage Chart

Confluent Annual Data
Trend Dec19 Dec20 Dec21 Dec22 Dec23 Dec24
Degree of Operating Leverage
Get a 7-Day Free Trial 2.38 0.71 0.71 -0.12 -0.23

Confluent Quarterly Data
Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24 Dec24 Mar25
Degree of Operating Leverage Get a 7-Day Free Trial 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 -0.43 -0.56 -0.64 -0.23 -0.13

Competitive Comparison of Confluent's Degree of Operating Leverage

For the Software - Infrastructure subindustry, Confluent's Degree of Operating Leverage, along with its competitors' market caps and Degree of Operating Leverage 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.


Confluent's Degree of Operating Leverage Distribution in the Software Industry

For the Software industry and Technology sector, Confluent's Degree of Operating Leverage distribution charts can be found below:

* The bar in red indicates where Confluent's Degree of Operating Leverage falls into.


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Confluent Degree of Operating Leverage Calculation

Confluent's Degree of Operating Leverage for the quarter that ended in Mar. 2025 is calculated as:

Degree of Operating Leverage=% Change in EBIT**/% Change in Revenue
=( -408.974 (Mar. 2025) / -422.559 (Mar. 2024) - 1 )/( 1017.525 (Mar. 2025) / 819.887 (Mar. 2024) - 1 )
=-0.0321/0.2411
=-0.13***

* 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.

** TTM data of EBIT and Revenue was used to calculate Degree of Operating Leverage.
*** Please be aware that the Degree of Operating Leverage calculations are based on company-level data using the primary share class. The calculated data provided is for demonstration purposes and may slightly differ from the results displayed in the title due to potential variations caused by currency exchange rate differences throughout the year.


Confluent  (NAS:CFLT) Degree of Operating Leverage Explanation

Degree of Operating Leverage (DOL) is a leverage ratio that measures the sensitivity of a company’s operting income, also referred to as Earnings Before Interest and Taxes (EBIT), to fluctuations in its Revenue. DOL is a method used to quantify a company’s operating risk. This risk is related to the company's structure of variable costs and fixed costs. Since the fixed costs do not allow the company to adjust the operating costs, the operating risk rises with a higher fixed-to-variable costs proportion.

A high Degree of Operating Leverage indicates that the company’s fixed costs exceed its variable costs. By increasing the sales, the company can earn more profits. In addition, the company must be able to maintain relatively high sales to cover all fixed costs.

Be Aware

The use of operating leverage varies across different industries and business sectors, and the application of Degree of Operating Leverage (DOL) should be adjusted accordingly.


Confluent Degree of Operating Leverage Related Terms

Thank you for viewing the detailed overview of Confluent's Degree of Operating Leverage provided by GuruFocus.com. Please click on the following links to see related term pages.


Confluent Business Description

Industry
Traded in Other Exchanges
Address
899 West Evelyn Avenue, Mountain View, CA, USA, 94041
Confluent Inc provides a data streaming platform that enables customers to connect their applications, systems, and data layers and can be deployed as a fully managed cloud-native software-as-a-service (SaaS) offering. Its products include Confluent Cloud, a self-managed software offering, Confluent Platform, a managed service offering where the raw data resides inside a customer's cloud environment, and WarpStream, among others. Confluent also offers professional services and education services. The company generates revenue from the sale of subscriptions and services. Geographically, it generates a majority of its revenue from its business in the United States and the rest from International markets.
Executives
Rohan Sivaram officer: Chief Financial Officer C/O CONFLUENT, INC., 899 W. EVELYN AVENUE, MOUNTAIN VIEW CA 94041
Edward Jay Kreps director, 10 percent owner, officer: Chief Executive Officer C/O CONFLUENT, INC., 899 W. EVELYN AVENUE, MOUNTAIN VIEW CA 94041
Eric Vishria director, 10 percent owner 2965 WOODSIDE ROAD, WOODSIDE CA 94062
Neha Narkhede director C/O CONFLUENT, INC., 899 W EVELYN AVENUE, MOUNTAIN VIEW CA 94041
Erica Schultz officer: President, Field Operations C/O NEW RELIC, INC., 188 SPEAR STREET, STE. 1200, SAN FRANCISCO CA 94105
Jonathan Chadwick director 3401 HILLVIEW AVENUE, PALO ALTO CA 94304
Michelangelo Volpi director C/O HORTONWORKS, INC., 3640 W. BAYSHORE RD., PALO ALTO CA 94303
Matthew Craig Miller director, 10 percent owner 2800 SAND HILL ROAD, SUITE 101, MENLO PARK CA 94025
Lara Caimi director C/O CONFLUENT, INC., 899 W EVELYN AVENUE, MOUNTAIN VIEW CA 94041
Stephanie Buscemi officer: Chief Marketing Officer C/O IHS INC., 15 INVERNESS EAST WAY, ENGLEWOOD CO 80107
Chad Verbowski officer: SVP of Engineering C/O CONFLUENT, INC., 899 W. EVELYN AVENUE, MOUNTAIN VIEW CA 94041
Ying Christina Liu officer: Chief Accounting Officer C/O ZENDESK, INC., 1019 MARKET STREET, SAN FRANCISCO CA 94103
Steffan Tomlinson officer: Chief Financial Officer PALO ALTO NETWORKS, INC., 3300 OLCOTT STREET, SANTA CLARA CA 95054
Sequoia Capital Fund, L.p. 10 percent owner 2800 SAND HILL ROAD, SUITE 101, MENLO PARK CA 94025
Index Ventures Vii Parallel Entrepreneur Fund (jersey), L.p. 10 percent owner C/O EFG WEALTH SOLUTIONS (JERSEY) LTD, NO. 1 SEATON PLACE, ST. HELIER Y9 JE4 8YJ