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Yonyou Network Technology Co (SHSE:600588) 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
Yonyou Network Technology Co had a gross margin of 44.72% for the quarter that ended in Mar. 2026 => 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.
Yonyou Network Technology Co Gross Margin % Related Terms
Yonyou Network Technology Co Gross Margin % Historical Data
* 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.
SHSE:600588 vs UBER, SHOP, CRM: Gross Margin % Comparison
For the Software - Application subindustry, Yonyou Network Technology Co'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.
Yonyou Network Technology Co Gross Margin % vs Software Industry
For the Software industry and Technology sector, Yonyou Network Technology Co's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Yonyou Network Technology Co'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.
Yonyou Network Technology Co (SHSE:600588) has a Gross Margin % of 44.72% as of Mar. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on Yonyou Network Technology Co and its competitors. This is 27% below median its historical median of 61.19. Over the past decade, Yonyou Network Technology Co's Gross Margin % has ranged from 47.54 to 71.43. According to the industry distribution chart, Yonyou Network Technology Co ranks #1025 out of 2685 companies in the Software industry, placing it in the top 38.2%.
Is Yonyou Network Technology Co's Gross Margin % too high?
Yonyou Network Technology Co's current Gross Margin % of 44.72% is 27% below median its 10-year median of 61.19. Over the past 10 years, this metric has ranged from a low of 47.54 to a high of 71.43. The Software industry median Gross Margin % is 40.46. Yonyou Network Technology Co's value of 44.72% is 10.5% above this industry median. Based on the distribution chart, Yonyou Network Technology Co ranks #1025 out of 2685 companies in the Software industry, which is above the industry midpoint. Overall, Yonyou Network Technology Co has a GF Score™ of 65/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Yonyou Network Technology Co's Gross Margin % compare to UBER and SHOP?
According to the Software industry distribution chart, Yonyou Network Technology Co ranks #1025 out of 2685 companies for Gross Margin %. This puts Yonyou Network Technology Co in the upper half of its industry. The industry median Gross Margin % is 40.46. Yonyou Network Technology Co's value of 44.72% is 10.5% above this benchmark. Historically, Yonyou Network Technology Co's own Gross Margin % has ranged from 47.54 to 71.43 over the past decade. While the company's 10-year median is 61.19 vs. the industry median of 40.46, Yonyou Network Technology Co has consistently been above 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 40.46, 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. Yonyou Network Technology Co's current Gross Margin % of 44.72% is 10.5% above 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 Yonyou Network Technology Co and its competitors. For the Software industry, the median Gross Margin % is 40.46 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Yonyou Network Technology Co's current Gross Margin % is 44.72%, which is 27% below median its own 10-year median of 61.19. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Yonyou Network Technology Co stock overvalued right now?
Based on GuruFocus' analysis, Yonyou Network Technology Co (SHSE:600588) is currently considered Possible Value Trap. The stock's GF Value™ is ¥14.25, compared to a current price of ¥9.01 — trading 36.8% below its estimated fair value. The current Gross Margin % is 44.72%, which is 27% below median its 10-year median of 61.19 and 10.5% above the Software industry median of 40.46. Yonyou Network Technology Co's overall GF Score™ is 65/100 with 3 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 Yonyou Network Technology Co (SHSE:600588), the current Gross Margin % is 44.72% as of Mar. 2026. 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.
Is Yonyou Network Technology Co (SHSE:600588) Overvalued in 2026?
Based on GuruFocus' analysis, Yonyou Network Technology Co stock appears to be undervalued.
The current stock price of ¥9.01 is trading 36.8% below its estimated GF Value™ of ¥14.25.
GuruFocus considers Yonyou Network Technology Co to be Possible Value Trap.
Key valuation signals for SHSE:600588:
Gross Margin %: 44.72% (27% below median its 10-year median of 61.19)
GF Value™: ¥14.25 vs. price of ¥9.01 (36.8% below fair value)
Industry Position: 10.5% above the Software median (#1025 of 2685)
No single metric tells the full story. See the SHSE:600588 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Yonyou Network Technology Co Ltd with its subsidiary, is engaged in technology development, technical consulting, hardware, and peripheral equipment; property management; sales of computer software, hardware, and peripheral equipment; design, production, and others. The company also offers training programs.
65GF Score
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