Gross Margin % is calculated as gross profit divided by its revenue. CME Group's Gross Profit for the
three
months ended in Dec. 2023 was $1,226 Mil. CME Group's Revenue for the
three
months ended in Dec. 2023 was $1,439 Mil. Therefore, CME Group's Gross Margin % for the quarter that ended in Dec. 2023 was 85.21%.
The historical rank and industry rank for CME Group's Gross Margin % or its related term are showing as below:
CME'
s Gross Margin % Range Over the Past 10 Years
Min: 81.23 Med: 83.46 Max: 85.24
Current: 85.24
During the past 13 years, the highestGross Margin % of CME Group was 85.24%. The lowest was 81.23%. And the median was 83.46%.
CME's Gross Margin % is ranked better than 84.3% of 605
companies
in the Capital Markets industry
Industry Median: 48.7
vs CME: 85.24
CME Group had a gross margin of 85.21% for the quarter that ended in Dec. 2023 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for CME Group was 0.50% per year.
CME Group Gross Margin % Historical Data
The historical data trend for CME Group'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.
Competitive Comparison of CME Group's Gross Margin %
For the Financial Data & Stock Exchanges subindustry, CME Group'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.
CME Group's Gross Margin % Distribution in the Capital Markets Industry
For the Capital Markets industry and Financial Services sector, CME Group's Gross Margin % distribution charts can be found below:
* The bar in red indicates where CME Group'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.
CME Group (NAS:CME) 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
CME Group had a gross margin of 85.21% 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.
CME Group Gross Margin % Related Terms
Thank you for viewing the detailed overview of CME Group's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Based in Chicago, CME Group operates exchanges giving investors, suppliers, and businesses the ability to trade futures and derivatives based on interest rates, equity indexes, foreign currencies, energy, metals, and commodities. The CME was founded in 1898 and in 2002 completed its initial public offering. Since then, CME Group has consolidated parts of the industry by merging with crosstown rival, CBOT Holdings in 2007 before acquiring Nymex Holdings in 2008 and NEX in 2018. In addition, the company has a 27% stake in S&P Dow Jones Indices, making the Chicago Mercantile Exchange the exclusive venue to trade and clear S&P futures contracts. Through CME's acquisition of NEX in 2018 it has also expanded into cash foreign exchange, fixed income trading, and collateral optimization.
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