Gross Margin % is calculated as gross profit divided by its revenue. Switch's Gross Profit for the
three
months ended in Sep. 2022 was $47.9 Mil. Switch's Revenue for the
three
months ended in Sep. 2022 was $174.5 Mil. Therefore, Switch's Gross Margin % for the quarter that ended in Sep. 2022 was 27.45%.
Warning Sign:
Switch Inc gross margin has been in long-term decline. The average rate of decline per year is -1.6%.
The historical rank and industry rank for Switch's Gross Margin % or its related term are showing as below:
SWCH'
s Gross Margin % Range Over the Past 10 Years
Min: 37.79 Med: 46.94 Max: 47.6
Current: 37.79
During the past 7 years, the highestGross Margin % of Switch was 47.60%. The lowest was 37.79%. And the median was 46.94%.
SWCH's Gross Margin % is not ranked
in the Software industry.
Industry Median: 41.685
vs SWCH: 37.79
Switch had a gross margin of 27.45% for the quarter that ended in Sep. 2022 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for Switch was -1.60% per year.
Switch Gross Margin % Historical Data
The historical data trend for Switch'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.
For the Information Technology Services subindustry, Switch'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.
Switch's Gross Margin % Distribution in the Software Industry
For the Software industry and Technology sector, Switch's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Switch'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.
Switch (NYSE:SWCH) 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
Switch had a gross margin of 27.45% for the quarter that ended in Sep. 2022 => 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.
Switch Gross Margin % Related Terms
Thank you for viewing the detailed overview of Switch's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Switch Inc is a US-based technology infrastructure company. It is engaged in designing, constructing, and operating hyper-scale data centers. The company has developed patented technologies that have redefined data center space and cooling, allowing customers to deploy high-density and scalable IT architectures to support demanding and critical workloads. Switch owns and operates primary campus locations called Primes. These Primes are The Core Campus in Vegas, Nevada; The Citadel Campus near Reno, Nevada; The Pyramid Campus in Grand Rapids, Michigan; and The Keep Campus in Atlanta, Georgia. It generates the majority of its revenue through colocation, which includes the licensing and leasing of cabinet space & power.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
SWCH has been successfully added to your 