CarGurus (CarGurus) Gross Margin %

: 75.31% (As of Dec. 2023)

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Gross Margin % is calculated as gross profit divided by its revenue. CarGurus's Gross Profit for the three months ended in Dec. 2023 was $168.0 Mil. CarGurus's Revenue for the three months ended in Dec. 2023 was $223.1 Mil. Therefore, CarGurus's Gross Margin % for the quarter that ended in Dec. 2023 was 75.31%.

Warning Sign:

CarGurus Inc gross margin has been in long-term decline. The average rate of decline per year is -11.5%.

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

CARG' s Gross Margin % Range Over the Past 10 Years
Min: 39.73 Med: 93.84 Max: 95.71
Current: 71.26

During the past 9 years, the highest Gross Margin % of CarGurus was 95.71%. The lowest was 39.73%. And the median was 93.84%.

CARG's Gross Margin % is ranked better than
98.43% of 1270 companies
in the Vehicles & Parts industry
Industry Median: 19.36 vs CARG: 71.26

CarGurus had a gross margin of 75.31% for the quarter that ended in Dec. 2023 => Durable competitive advantage

The 5-Year average Growth Rate of Gross Margin for CarGurus was -11.50% per year.

CarGurus Gross Margin % Historical Data

The historical data trend for CarGurus'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.

CarGurus Annual Data

Trend

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Gross Margin %

93.84

92.26

69.10

39.73

71.26

CarGurus Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Gross Margin %																47.79	66.81	68.47	74.88	75.31

Competitive Comparison

For the Auto & Truck Dealerships subindustry, CarGurus'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.

CarGurus Gross Margin % Distribution

For the Vehicles & Parts industry and Consumer Cyclical sector, CarGurus's Gross Margin % distribution charts can be found below:

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

CarGurus Gross Margin % Calculation

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

CarGurus'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 )
	=	651.5	/	914.242
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(914.242 - 262.788)	/	914.242
	=	71.26 %

CarGurus'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 )
	=	168	/	223.123
	=	(Revenue - Cost of Goods Sold)	/	Revenue
	=	(223.123 - 55.088)	/	223.123
	=	75.31 %

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.

CarGurus (NAS:CARG) 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

CarGurus had a gross margin of 75.31% for the quarter that ended in Dec. 2023 => 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.

CarGurus Gross Margin % Related Terms

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CarGurus (CarGurus) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Vehicles & Parts » CarGurus Inc (NAS:CARG) » Definitions » Gross Margin %

Comparable Companies

Traded in Other Exchanges

0C6:Germany

Address

2 Canal Park, 4th Floor, Cambridge, MA, USA, 02141

Website

https://www.cargurus.com

CarGurus Inc is a company that acts as an online automotive marketplace connecting buyers and sellers of new and used cars. The company provides three types of marketplace Listing products, Restricted Listings, and Enhanced or Featured Listing through which it offers real-time and historical data analyzing the connections and pricing analysis. It also provides all dealers with a web widget to place Deal Rating Badges, which show deal rating. The listing platforms offer auto manufacturers and others to buy advertising on the company's site and target consumers based on the make, model, and zip code of the cars. The company operates through two geographical segments namely United States and the International. It generates majority of revenue from the United States.

Executives

Manik Gupta	director	1999 SCOTT LN, LOS ALTOS CA 94024
Javier Esquivel Zamora	officer: General Counsel and Secretary	C/O CARGURUS, INC., 2 CANAL PARK, 4TH FLOOR, CAMBRIDGE MA 02141
Samuel Zales	officer: Chief Operating Officer	C/O CARGURUS, INC., 2 CANAL PARK, 4TH FL., CAMBRIDGE MA 02141
Scot Christopher Fredo	officer: CFO and Treasurer	C/O CARGURUS, INC., 2 CANAL PARK, 4TH FLOOR, CAMBRIDGE MA 02141
Thomas Michael Caputo	officer: Sr. VP, Product	C/O CARGURUS, INC., 2 CANAL PARK, 4TH FL., CAMBRIDGE MA 02141
Andrea Lee Eldridge	officer: Chief People Officer	C/O CARGURUS, INC., 2 CANAL PARK, 4TH FLOOR, CAMBRIDGE MA 02141
Yann Bruno Gellot	officer: VP, Finance & Accounting (PAO)	C/O CARGURUS, INC., 2 CANAL PARK, 4TH FLOOR, CAMBRIDGE MA 02141
Matthew Todd Quinn	officer: Chief Technology Officer	C/O CARGURUS, INC., 2 CANAL PARK, 4TH FLOOR, CAMBRIDGE MA 02141
Langley Steinert	director, 10 percent owner, officer: CEO, President and Chairman	C/O CARGURUS, INC., 2 CANAL PARK, 4TH FLOOR, CAMBRIDGE MA 02141
Dafna Sarnoff	officer: Chief Marketing Officer	C/O CARGURUS, INC., 2 CANAL PARK, 4TH FLOOR, CAMBRIDGE MA 02141
Kathleen Bender Patton	officer: Sr. VP, GC and Secretary	2 CANAL PARK, 4TH FLOOR, CAMBRIDGE MA 02141
Sarah Amory Welch	officer: Sr. VP, Consumer Marketing	C/O CARGURUS, INC., 2 CANAL PARK, 4TH FL., CAMBRIDGE MA 02141
Yvonne Hao	director	C/O BAIN CAPITAL PARTNERS, LP, 200 CLARENDON STREET, BOSTON MA 02116
Anastasios Parafestas	director, 10 percent owner	C/O THE BOLLARD GROUP LLC, ONE JOY STREET, BOSTON MA 02108
Greg M Schwartz	director	C/O ZILLOW GROUP, INC., 1301 SECOND AVENUE, FLOOR 31, SEATTLE WA 98101