Afterpay (Afterpay) Gross Margin % : 72.54% (As of Jun. 2021)

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What is Afterpay Gross Margin %?

Gross Margin % is calculated as gross profit divided by its revenue. Afterpay's Gross Profit for the six months ended in Jun. 2021 was $281.2 Mil. Afterpay's Revenue for the six months ended in Jun. 2021 was $387.7 Mil. Therefore, Afterpay's Gross Margin % for the quarter that ended in Jun. 2021 was 72.54%.

The historical rank and industry rank for Afterpay's Gross Margin % or its related term are showing as below:

AFTPY' s Gross Margin % Range Over the Past 10 Years
Min: 73 Med: 77.45 Max: 81.86
Current: 73

During the past 5 years, the highest Gross Margin % of Afterpay was 81.86%. The lowest was 73.00%. And the median was 77.45%.

AFTPY's Gross Margin % is not ranked
in the Software industry.
Industry Median: 41.845 vs AFTPY: 73.00

Afterpay had a gross margin of 72.54% for the quarter that ended in Jun. 2021 => Durable competitive advantage

The 5-Year average Growth Rate of Gross Margin for Afterpay was 0.00% per year.

Afterpay Gross Margin % Historical Data

The historical data trend for Afterpay'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.

Afterpay Gross Margin % Chart

Afterpay Annual Data

Trend

Jun17

Jun18

Jun19

Jun20

Jun21

Gross Margin %

81.86

80.18

77.45

74.13

73.00

Afterpay Semi-Annual Data
	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21
Gross Margin %	Get a 7-Day Free Trial				77.84	74.84	73.61	73.55	72.54

Competitive Comparison of Afterpay's Gross Margin %

For the Software - Infrastructure subindustry, Afterpay'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.

Afterpay's Gross Margin % Distribution in the Software Industry

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

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

Afterpay Gross Margin % Calculation

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

Afterpay's Gross Margin for the fiscal year that ended in Jun. 2021 is calculated as

Gross Margin % (A: Jun. 2021 )	=	Gross Profit (A: Jun. 2021 )	/	Revenue (A: Jun. 2021 )
	=	515.8	/	706.622
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(706.622 - 190.799)	/	706.622
	=	73.00 %

Afterpay's Gross Margin for the quarter that ended in Jun. 2021 is calculated as

Gross Margin % (Q: Jun. 2021 )	=	Gross Profit (Q: Jun. 2021 )	/	Revenue (Q: Jun. 2021 )
	=	281.2	/	387.657
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(387.657 - 106.434)	/	387.657
	=	72.54 %

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.

Afterpay (OTCPK:AFTPY) 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

Afterpay had a gross margin of 72.54% for the quarter that ended in Jun. 2021 => 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.

Afterpay Gross Margin % Related Terms

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Afterpay (Afterpay) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Software » Afterpay Ltd (OTCPK:AFTPY) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

N/A

Address

406 Collins Street, Level 5, Melbourne, VIC, AUS, 3000

Website

https://www.afterpay.com

Afterpay started its buy now, pay later, or BNPL, financing product in calendar 2015, listed on the ASX in May 2016 and merged with Touchcorp (who designed and built Afterpay's platform software) in June 2017. Its BNPL platform allows consumers to make acquisitions at merchant partners by paying instalments every two weeks. If consumers pay on time, they transact on Afterpay for free. Afterpay primarily generates revenue from receiving a margin from the merchant. Afterpay pays the merchant the full purchase price immediately on the sale, less this margin. The margin compensates Afterpay for accepting all non-payment risk, including credit risk and fraud by the consumer, and for encouraging consumers to purchase greater dollar values and transact more frequently.