The AES (The AES) Gross Margin %

: 16.64% (As of Dec. 2023)

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Gross Margin % is calculated as gross profit divided by its revenue. The AES's Gross Profit for the three months ended in Dec. 2023 was $494.00 Mil. The AES's Revenue for the three months ended in Dec. 2023 was $2,968.00 Mil. Therefore, The AES's Gross Margin % for the quarter that ended in Dec. 2023 was 16.64%.

Warning Sign:

The AES Corp gross margin has been in long-term decline. The average rate of decline per year is -4.2%.

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

AESC' s Gross Margin % Range Over the Past 10 Years
Min: 18.48 Med: 23.3 Max: 27.88
Current: 19.77

During the past 13 years, the highest Gross Margin % of The AES was 27.88%. The lowest was 18.48%. And the median was 23.30%.

AESC's Gross Margin % is ranked worse than
66.6% of 503 companies
in the Utilities - Regulated industry
Industry Median: 28.6 vs AESC: 19.77

The AES had a gross margin of 16.64% for the quarter that ended in Dec. 2023 => No sustainable competitive advantage

The 5-Year average Growth Rate of Gross Margin for The AES was -4.20% per year.

The AES Gross Margin % Historical Data

The historical data trend for The AES'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.

The AES Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Gross Margin %

23.05

27.88

24.33

20.19

19.77

The AES Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Gross Margin %																18.40	18.34	16.45	26.73	16.64

Competitive Comparison

For the Utilities - Diversified subindustry, The AES'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.

The AES Gross Margin % Distribution

For the Utilities - Regulated industry and Utilities sector, The AES's Gross Margin % distribution charts can be found below:

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

The AES Gross Margin % Calculation

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

The AES'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 )
	=	2504	/	12668
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(12668 - 10164)	/	12668
	=	19.77 %

The AES's Gross Margin for the quarter that ended in Dec. 2023 is calculated as

Gross Margin % (Q: Dec. 2023 )	=	Gross Profit (Q: Dec. 2023 )	/	Revenue (Q: Dec. 2023 )
	=	494	/	2968
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(2968 - 2474)	/	2968
	=	16.64 %

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.

The AES (NYSE:AESC) 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

The AES had a gross margin of 16.64% for the quarter that ended in Dec. 2023 => 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.

The AES Gross Margin % Related Terms

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The AES (The AES) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Utilities » Utilities - Regulated » The AES Corp (NYSE:AESC) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

AES:USA AES:Germany A1ES34:Brazil

Address

4300 Wilson Boulevard, 11th Floor, Arlington, VA, USA, 22203

Website

https://www.aes.com

AES is a global power company. Its current generation portfolio as of year-end 2022 consists of over 32 gigawatts of generation including renewable energy (46%), gas (32%), coal (20%), and oil (2%). AES has majority ownership and operates six electric utilities distributing power to 2.6 million customers.