Gross Margin

Metric Name

Gross Margin

Metric Family

Income Statement

Metric Definition

Percentage of total revenue that exceeds the cost of goods sold. It indicates how efficiently a company is producing and delivering its service

Formula

Gross Margin (%) = (Total Revenue - COGS / Total Revenue)

Application

High and stable gross margin indicates a strong and sustainable business model. Comparing this metric against competitors can provide insight into how the company manages expenses compared to overs.