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Apple Inc  (NAS:AAPL) Gross Margin %: 38.29% (As of Sep. 2018)

Gross Margin % is calculated as gross profit divided by its revenue. Apple Inc's Gross Profit for the three months ended in Sep. 2018 was $24,084 Mil. Apple Inc's Revenue for the three months ended in Sep. 2018 was $62,900 Mil. Therefore, Apple Inc's Gross Margin % for the quarter that ended in Sep. 2018 was 38.29%.


NAS:AAPL' s Gross Margin % Range Over the Past 10 Years
Min: 37.62   Max: 43.87
Current: 38.34

37.62
43.87

During the past 13 years, the highest Gross Margin % of Apple Inc was 43.87%. The lowest was 37.62%. And the median was 39.23%.

NAS:AAPL's Gross Margin % is ranked higher than
80% of the 2180 Companies
in the Global industry.

( Industry Median: 23.19 vs. NAS:AAPL: 38.34 )

Apple Inc had a gross margin of 38.29% for the quarter that ended in Sep. 2018 => Competition eroding margins

The 5-Year average Growth Rate of Gross Margin for Apple Inc was 0.20% per year.


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Apple Inc Annual Data

Sep09 Sep10 Sep11 Sep12 Sep13 Sep14 Sep15 Sep16 Sep17 Sep18
Gross Margin % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 38.59 40.06 39.08 38.47 38.34

Apple Inc Quarterly Data

Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17 Dec17 Mar18 Jun18 Sep18
Gross Margin % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 37.91 38.41 38.31 38.34 38.29

Competitive Comparison
* 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.


Apple Inc Distribution

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



Calculation

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

Apple Inc's Gross Margin for the fiscal year that ended in Sep. 2018 is calculated as

Gross Margin % (A: Sep. 2018 )=Gross Profit (A: Sep. 2018 ) / Revenue (A: Sep. 2018 )
=101839 / 265595
=(Revenue - Cost of Goods Sold) / Revenue
=(265595 - 163756) / 265595
=38.34 %

Apple Inc's Gross Margin for the quarter that ended in Sep. 2018 is calculated as


Gross Margin % (Q: Sep. 2018 )=Gross Profit (Q: Sep. 2018 ) / Revenue (Q: Sep. 2018 )
=-38816 / 62900
=(Revenue - Cost of Goods Sold) / Revenue
=(62900 - 38816) / 62900
=38.29 %

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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.


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

Apple Inc had a gross margin of 38.29% for the quarter that ended in Sep. 2018 => 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.


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