Gross Margin % is calculated as gross profit divided by its revenue. Unity Software's Gross Profit for the
three
months ended in Dec. 2023 was $348 Mil. Unity Software's Revenue for the
three
months ended in Dec. 2023 was $609 Mil. Therefore, Unity Software's Gross Margin % for the quarter that ended in Dec. 2023 was 57.07%.
Warning Sign:
Unity Software Inc gross margin has been in long-term decline. The average rate of decline per year is -3.5%.
The historical rank and industry rank for Unity Software's Gross Margin % or its related term are showing as below:
U'
s Gross Margin % Range Over the Past 10 Years
Min: 66.46 Med: 77.43 Max: 78.66
Current: 66.46
During the past 6 years, the highestGross Margin % of Unity Software was 78.66%. The lowest was 66.46%. And the median was 77.43%.
U's Gross Margin % is ranked better than 75.08% of 2628
companies
in the Software industry
Industry Median: 41.685
vs U: 66.46
Unity Software had a gross margin of 57.07% for the quarter that ended in Dec. 2023 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Unity Software was -3.50% per year.
Unity Software Gross Margin % Historical Data
The historical data trend for Unity Software'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 Unity Software's Gross Margin %
For the Software - Application subindustry, Unity Software'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.
Unity Software's Gross Margin % Distribution in the Software Industry
For the Software industry and Technology sector, Unity Software's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Unity Software'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
Unity Software had a gross margin of 57.07% 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.
Unity Software Gross Margin % Related Terms
Thank you for viewing the detailed overview of Unity Software's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Unity Software (Unity Software) Business Description
Unity Software Inc provides a software platform for creating and operating interactive, real-time 3D content. The platform can be used to create, run and monetize interactive, real-time 2D and 3D content for mobile phones, tablets, PCs, consoles, and augmented and virtual reality devices. The business is spread across the United States, Greater China, EMEA, APAC and Other Americas, of which key revenue is derived from the EMEA region. The products are used in the gaming industry, architecture and construction sector, animation industry, and designing sector.
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