A.O. Smith (BSP:A1OS34) Gross Margin % : 37.37% (As of Sep. 2024)

View and export this data going back to 2019. Start your Free Trial

What is A.O. Smith Gross Margin %?

Gross Margin % is calculated as gross profit divided by its revenue. A.O. Smith's Gross Profit for the three months ended in Sep. 2024 was R$1,868 Mil. A.O. Smith's Revenue for the three months ended in Sep. 2024 was R$4,998 Mil. Therefore, A.O. Smith's Gross Margin % for the quarter that ended in Sep. 2024 was 37.37%.

Warning Sign:

A.O. Smith Corp gross margin has been in long-term decline. The average rate of decline per year is -1.9%.

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

BSP:A1OS34' s Gross Margin % Range Over the Past 10 Years
Min: 35.42 Med: 39 Max: 41.48
Current: 38.21

During the past 13 years, the highest Gross Margin % of A.O. Smith was 41.48%. The lowest was 35.42%. And the median was 39.00%.

BSP:A1OS34's Gross Margin % is ranked better than
77.1% of 2934 companies
in the Industrial Products industry
Industry Median: 26.73 vs BSP:A1OS34: 38.21

A.O. Smith had a gross margin of 37.37% for the quarter that ended in Sep. 2024 => Competition eroding margins

The 5-Year average Growth Rate of Gross Margin for A.O. Smith was -1.90% per year.

A.O. Smith Gross Margin % Historical Data

The historical data trend for A.O. Smith'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.

A.O. Smith Gross Margin % Chart

A.O. Smith Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Gross Margin %

Get a 7-Day Free Trial

39.45

38.28

37.04

35.42

38.54

A.O. Smith Quarterly Data
	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24
Gross Margin %	Get a 7-Day Free Trial															37.99	37.43	39.30	38.66	37.37

Competitive Comparison of A.O. Smith's Gross Margin %

For the Specialty Industrial Machinery subindustry, A.O. Smith'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.

A.O. Smith's Gross Margin % Distribution in the Industrial Products Industry

For the Industrial Products industry and Industrials sector, A.O. Smith's Gross Margin % distribution charts can be found below:

* The bar in red indicates where A.O. Smith's Gross Margin % falls into.

A.O. Smith Gross Margin % Calculation

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

A.O. Smith's Gross Margin for the fiscal year that ended in Dec. 2023 is calculated as

Gross Margin % (A: Dec. 2023 )	=	Gross Profit (A: Dec. 2023 )	/	Revenue (A: Dec. 2023 )
	=	7275.2	/	18877.949
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(18877.949 - 11602.726)	/	18877.949
	=	38.54 %

A.O. Smith's Gross Margin for the quarter that ended in Sep. 2024 is calculated as

Gross Margin % (Q: Sep. 2024 )	=	Gross Profit (Q: Sep. 2024 )	/	Revenue (Q: Sep. 2024 )
	=	1867.9	/	4998.418
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(4998.418 - 3130.518)	/	4998.418
	=	37.37 %

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.

A.O. Smith (BSP:A1OS34) 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

A.O. Smith had a gross margin of 37.37% for the quarter that ended in Sep. 2024 => Competition eroding margins

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.

A.O. Smith Gross Margin % Related Terms

Thank you for viewing the detailed overview of A.O. Smith's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.

A.O. Smith Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Industrial Products » A.O. Smith Corp (BSP:A1OS34) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

AOS:USA 0L7A:UK 3SM:Germany 3SM:Germany

Address

11270 West Park Place, P. O. Box 245008, Suite 170, Milwaukee, WI, USA, 53224-9508

Website

https://www.aosmith.com

A.O. Smith Corporation manufactures a broad lineup of water heaters, boilers, and water treatment products. The company has two reporting segments, North America (75% of sales) and rest of world (25% of sales). A.O. Smith is the leading manufacturer of water heaters in North America for both residential and commercial markets, with approximately 37% and 54% market share, respectively. Residential water heaters account for Most of North American sales and are distributed equally through wholesale and retail channels. Most of A.O. Smith's international revenue is from China, a market the company entered during the mid-1990s.

A.O. Smith Headlines

No Headlines