Kodiak Gas Services, Inc. (KGS)

Gross profit margin

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Gross profit	US$ in thousands	440,663	316,641	440,562	396,198	207,475
Revenue	US$ in thousands	1,159,310	850,381	707,913	606,375	532,420
Gross profit margin		38.01%	37.24%	62.23%	65.34%	38.97%

December 31, 2024 calculation

Gross profit margin = Gross profit ÷ Revenue
= $440,663K ÷ $1,159,310K
= 38.01%

The gross profit margin of Kodiak Gas Services, Inc. demonstrates notable fluctuations over the observed period from December 31, 2020, through December 31, 2024. In 2020, the gross profit margin stood at 38.97%, indicating a moderate level of profitability relative to revenue. This margin substantially increased in 2021 to 65.34%, reflecting a significant improvement in gross profitability and possibly efficiencies gained or favorable market conditions. However, the margin declined in 2022 to 62.23%, though it remained relatively high, suggesting some reduction in profit per dollar of revenue, potentially due to increased costs or competitive pressures.

By 2023, the gross profit margin experienced a pronounced decrease to 37.24%, falling below the initial 2020 level and signaling a decline in gross profitability. This sharp reduction could be indicative of rising costs, lower pricing power, or changes in revenue composition affecting margins adversely. Lastly, in 2024, the margin slightly recovered to 38.01%, almost returning to the 2020 baseline, suggesting a stabilization of gross profitability levels after the prior decline.

Overall, the gross profit margin reveals considerable variability, with a peak in 2021 that was not sustained in subsequent years. The fluctuations indicate changes in cost structure, pricing strategies, or operational efficiencies over the period, which are crucial to understanding the company’s overall financial health and competitive positioning within the industry.