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CPU Softwarehouse AG (FRA:CPU2) 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
CPU Softwarehouse AG had a gross margin of 30.20% for the quarter that ended in Dec. 2023 => 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.
CPU Softwarehouse AG Gross Margin % Related Terms
CPU Softwarehouse AG Gross Margin % Historical Data
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The historical data trend for CPU Softwarehouse AG'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.
FRA:CPU2 vs CRM, SHOP, UBER: Gross Margin % Comparison
For the Software - Application subindustry, CPU Softwarehouse AG'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.
CPU Softwarehouse AG Gross Margin % vs Software Industry
For the Software industry and Technology sector, CPU Softwarehouse AG's Gross Margin % distribution charts can be found below:
* The bar in red indicates where CPU Softwarehouse AG'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.
CPU Softwarehouse AG (FRA:CPU2) has a Gross Margin % of 30.20% as of Dec. 2023. Gross margin is the ratio of total gross profit to net sales. View historical data on CPU Softwarehouse AG and its competitors. This is 58% below median its historical median of 72.73. Over the past decade, CPU Softwarehouse AG's Gross Margin % has ranged from 31.21 to 86.79.
Is CPU Softwarehouse AG's Gross Margin % too high?
CPU Softwarehouse AG's current Gross Margin % of 30.20% is 58% below median its 10-year median of 72.73. Over the past 10 years, this metric has ranged from a low of 31.21 to a high of 86.79. The Software industry median Gross Margin % is 40.07. CPU Softwarehouse AG's value of 30.20% is 24.6% below this industry median. Overall, CPU Softwarehouse AG has a GF Score™ of 30/100, reflecting its overall financial health beyond just this single metric.
How does CPU Softwarehouse AG's Gross Margin % compare to CRM and SHOP?
CPU Softwarehouse AG's Gross Margin % of 30.20% can be compared against companies in the Software industry. The industry median Gross Margin % is 40.07. CPU Softwarehouse AG's value of 30.20% is 24.6% below this benchmark. Historically, CPU Softwarehouse AG's own Gross Margin % has ranged from 31.21 to 86.79 over the past decade. While the company's 10-year median is 72.73 vs. the industry median of 40.07, CPU Softwarehouse AG 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 40.07, based on 2,684 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. CPU Softwarehouse AG's current Gross Margin % of 30.20% is 24.6% 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 CPU Softwarehouse AG and its competitors. For the Software industry, the median Gross Margin % is 40.07 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. CPU Softwarehouse AG's current Gross Margin % is 30.20%, which is 58% below median its own 10-year median of 72.73. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is CPU Softwarehouse AG stock overvalued right now?
CPU Softwarehouse AG (FRA:CPU2) has a current Gross Margin % of 30.20%. The current Gross Margin % is 30.20%, which is 58% below median its 10-year median of 72.73 and 24.6% below the Software industry median of 40.07. CPU Softwarehouse AG's overall GF Score™ is 30/100 with 7 warning signs 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 CPU Softwarehouse AG (FRA:CPU2), the current Gross Margin % is 30.20% as of Dec. 2023. 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.
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