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Gross Margin % is calculated as gross profit divided by its revenue. Ribbon Communications's Gross Profit for the three months ended in Mar. 2024 was $92.0 Mil. Ribbon Communications's Revenue for the three months ended in Mar. 2024 was $179.7 Mil. Therefore, Ribbon Communications's Gross Margin % for the quarter that ended in Mar. 2024 was 51.18%.
Warning Sign:
Ribbon Communications Inc gross margin has been in long-term decline. The average rate of decline per year is -4%.
The historical rank and industry rank for Ribbon Communications's Gross Margin % or its related term are showing as below:
During the past 13 years, the highest Gross Margin % of Ribbon Communications was 66.36%. The lowest was 48.91%. And the median was 58.21%.
Ribbon Communications had a gross margin of 51.18% for the quarter that ended in Mar. 2024 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Ribbon Communications was -4.00% per year.
The historical data trend for Ribbon Communications'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.
Ribbon Communications Annual Data | |||||||||||||||||||||
Trend | Dec14 | Dec15 | Dec16 | Dec17 | Dec18 | Dec19 | Dec20 | Dec21 | Dec22 | Dec23 | |||||||||||
Gross Margin % | Get a 7-Day Free Trial | 56.31 | 53.43 | 52.63 | 48.91 | 49.38 |
Ribbon Communications Quarterly Data | ||||||||||||||||||||
Jun19 | Sep19 | Dec19 | Mar20 | Jun20 | Sep20 | Dec20 | Mar21 | Jun21 | Sep21 | Dec21 | Mar22 | Jun22 | Sep22 | Dec22 | Mar23 | Jun23 | Sep23 | Dec23 | Mar24 | |
Gross Margin % | Get a 7-Day Free Trial | 43.73 | 48.18 | 50.95 | 53.76 | 51.18 |
For the Telecom Services subindustry, Ribbon Communications'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.
For the Telecommunication Services industry and Communication Services sector, Ribbon Communications's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Ribbon Communications's Gross Margin % falls into.
Gross Margin is the percentage of Gross Profit out of sales or Revenue.
Ribbon Communications'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 ) |
= | 408.1 | / | 826.339 | |
= | (Revenue - Cost of Goods Sold) | / | Revenue | |
= | (826.339 - 418.256) | / | 826.339 | |
= | 49.38 % |
Ribbon Communications's Gross Margin for the quarter that ended in Mar. 2024 is calculated as
Gross Margin % (Q: Mar. 2024 ) | = | Gross Profit (Q: Mar. 2024 ) | / | Revenue (Q: Mar. 2024 ) |
= | 92 | / | 179.664 | |
= | (Revenue - Cost of Goods Sold) | / | Revenue | |
= | (179.664 - 87.709) | / | 179.664 | |
= | 51.18 % |
* 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.
Ribbon Communications (NAS:RBBN) 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
Ribbon Communications had a gross margin of 51.18% for the quarter that ended in Mar. 2024 => 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.
Thank you for viewing the detailed overview of Ribbon Communications's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Miguel A Lopez | officer: EVP, CFO | HARRIS CORPORATION, 1025 W NASA BOULEVARD, MELBOURNE FL 32919 |
Bruce William Mcclelland | director, officer: President & CEO | 3871 LAKEFIELD DRIVE, SUWANEE GA 30024 |
Dan Redington | officer: EVP of Global Sales | 6500 CHASE OAKS BOULEVARD, SUITE 100, PLANO TX 75023 |
Scott Mair | director | 6500 CHASE OAKS BOULEVARD, SUITE 100, PLANO TX 75023 |
Swarth Investments Inc. | 10 percent owner | NEWPORT HOUSE, 15 THE GRANGE, ST PETER PORT Y7 GY1 4LA |
Jpmorgan Chase & Co | 10 percent owner | 383 MADISON AVENUE, NEW YORK NY 10017 |
Sam Bucci | officer: EVP & GM IP Optical Networks | 3605 E PLANO PARKWAY, PLANO TX 75074 |
Bruns H Grayson | director | 950 WINTER STREET, WALTHAM MA 02451 |
Stephen J. Mccaffery | officer: EVP EMEAS and APAC Sales | VICTORIA ROAD, WEST YORKSHIRE, SALTAIRE X0 BD183LF |
Eric S Marmurek | officer: SVP, Finance & CAO | C/O 4 TECHNOLOGY PARK DRIVE, WESTFORD MA 01886 |
Patrick W Macken | officer: EVP, Chief Legal Officer | 4515 THREE CHIMNEYS LANE, CUMMING GA 30041 |
Beatriz V Infante | director | 4 TECHNOLOGY PARK DRIVE, SONUS NETWORKS, INC., WESTFORD MA 01886 |
Ewing R Stewart Jr | director | 100 CENTURETEL DRIVE, MONROE LA 71203 |
Steven M Bruny | officer: EVP Sales, Americas | C/O 4 TECHNOLOGY PARK DRIVE, WESTFORD MA 01886 |
Shaul Shani | director | 4001 WEST PKWY, C/O SAPIENS USA INC, CURRY NC 27519 |
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