Item 9 Labs Corp gross margin has been in long-term decline. The average rate of decline per year is -6.5%.
The historical rank and industry rank for Item 9 Labs's Gross Margin % or its related term are showing as below:
INLB'
s Gross Margin % Range Over the Past 10 Years
Min: -3.54 Med: 39.92 Max: 66.8
Current: 49.8
During the past 13 years, the highestGross Margin % of Item 9 Labs was 66.80%. The lowest was -3.54%. And the median was 39.92%.
INLB's Gross Margin % is ranked better than 56.46% of 990
companies
in the Drug Manufacturers industry
Industry Median: 46.705
vs INLB: 49.80
Item 9 Labs had a gross margin of 56.13% for the quarter that ended in Jun. 2023 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Item 9 Labs was -6.50% per year.
Item 9 Labs Gross Margin % Historical Data
The historical data trend for Item 9 Labs'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 Item 9 Labs's Gross Margin %
For the Drug Manufacturers - Specialty & Generic subindustry, Item 9 Labs'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.
Item 9 Labs's Gross Margin % Distribution in the Drug Manufacturers Industry
For the Drug Manufacturers industry and Healthcare sector, Item 9 Labs's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Item 9 Labs'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.
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
Item 9 Labs had a gross margin of 56.13% for the quarter that ended in Jun. 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.
Item 9 Labs Gross Margin % Related Terms
Thank you for viewing the detailed overview of Item 9 Labs's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Item 9 Labs Corp is a vertically integrated cannabis operator and dispensary franchisor delivering premium products from its large-scale cultivation and production facilities in the United States. The Item 9 Labs brand specializes in products and user experience across several cannabis categories. The company also offers a dispensary franchise model through the national Unity Rd. retail brand. Easing barriers to entry, the franchise provides an opportunity for both new and existing dispensary owners to leverage the knowledge, resources, and ongoing support needed to thrive in their state compliantly and successfully. It also brings industry practices to markets nationwide through distinctive retail experience, cultivation capabilities, and product innovation.
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