Stepchange HoldingsASX:STH -1.92%24 Gross Margin % is 12.85% as of Dec. 2025, which is 8% below its 10-year median of 13.99. GuruFocus rates ASX:STH with a GF Score™ of 24/100. The stock has 1 warning sign investors should review. Among 2,685 Software companies, Stepchange Holdings ranks worse than 88.86% on this metric.
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
Stepchange Holdings had a gross margin of 12.85% for the quarter that ended in Dec. 2025 => No sustainable 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.
Stepchange Holdings Gross Margin % Related Terms
Stepchange Holdings Gross Margin % Historical Data
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The historical data trend for Stepchange Holdings'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.
ASX:STH vs CRM, SHOP, UBER: Gross Margin % Comparison
For the Software - Application subindustry, Stepchange Holdings'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.
Stepchange Holdings Gross Margin % vs Software Industry
For the Software industry and Technology sector, Stepchange Holdings's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Stepchange Holdings's Gross Margin % falls into.
* 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.
Stepchange Holdings (ASX:STH) has a Gross Margin % of 12.85% as of Dec. 2025. Gross margin is the ratio of total gross profit to net sales. View historical data on Stepchange Holdings and its competitors. This is near median its historical median of 13.99. Over the past decade, Stepchange Holdings' Gross Margin % has ranged from 12.85 to 14.22. According to the industry distribution chart, Stepchange Holdings ranks #2386 out of 2685 companies in the Software industry, placing it in the top 88.9%.
Is Stepchange Holdings' Gross Margin % too high?
Stepchange Holdings' current Gross Margin % of 12.85% is near median its 10-year median of 13.99. Over the past 10 years, this metric has ranged from a low of 12.85 to a high of 14.22. The Software industry median Gross Margin % is 40.45. Stepchange Holdings' value of 12.85% is 68.2% below this industry median. Based on the distribution chart, Stepchange Holdings ranks #2386 out of 2685 companies in the Software industry, which is in the bottom quartile relative to peers. Overall, Stepchange Holdings has a GF Score™ of 24/100, reflecting its overall financial health beyond just this single metric.
How does Stepchange Holdings' Gross Margin % compare to CRM and SHOP?
According to the Software industry distribution chart, Stepchange Holdings ranks #2386 out of 2685 companies for Gross Margin %. This places Stepchange Holdings in the lower half of its industry. The industry median Gross Margin % is 40.45. Stepchange Holdings' value of 12.85% is 68.2% below this benchmark. Historically, Stepchange Holdings' own Gross Margin % has ranged from 12.85 to 14.22 over the past decade. While the company's 10-year median is 13.99 vs. the industry median of 40.45, Stepchange Holdings has consistently been below the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Gross Margin % for a Software company?
The median Gross Margin % among Software companies is 40.45, based on 2,685 companies in the industry. Companies in the top quartile (top 25%) have a Gross Margin % significantly above this median, while those in the bottom quartile fall well below. However, Gross Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Stepchange Holdings's current Gross Margin % of 12.85% is 68.2% below the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Gross Margin % mean?
A high Gross Margin % can signal that a stock is expensive relative to its fundamentals. Gross margin is the ratio of total gross profit to net sales. View historical data on Stepchange Holdings and its competitors. For the Software industry, the median Gross Margin % is 40.45 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Stepchange Holdings's current Gross Margin % is 12.85%, which is near median its own 10-year median of 13.99. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Stepchange Holdings stock overvalued right now?
Stepchange Holdings (ASX:STH) has a current Gross Margin % of 12.85%. The current Gross Margin % is 12.85%, which is near median its 10-year median of 13.99 and 68.2% below the Software industry median of 40.45. Stepchange Holdings' overall GF Score™ is 24/100 with 1 warning sign to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Gross Margin % calculated?
Gross Margin % is calculated from a company's financial statements. For Stepchange Holdings (ASX:STH), the current Gross Margin % is 12.85% as of Dec. 2025. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Stepchange Holdings Ltd is engaged in providing software services. It delivers end-to-end SAP ERP and digital transformation service. Its services include: Strategic Alignment and Execution; Program and Project Management; Change Management; and Business Analysis.
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