Kodiak Gas Services, Inc. (KGS)

Gross profit margin

		Jun 30, 2025	Mar 31, 2025	Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022
Gross profit (ttm)	US$ in thousands	514,869	486,333	440,663	407,625	412,414	419,683	453,055	479,445	465,488	452,339	440,562
Revenue (ttm)	US$ in thousands	1,286,651	1,273,461	1,159,311	1,075,772	982,108	875,761	850,381	804,177	755,839	729,684	707,913
Gross profit margin		40.02%	38.19%	38.01%	37.89%	41.99%	47.92%	53.28%	59.62%	61.59%	61.99%	62.23%

June 30, 2025 calculation

Gross profit margin = Gross profit (ttm) ÷ Revenue (ttm)
= $514,869K ÷ $1,286,651K
= 40.02%

The gross profit margin of Kodiak Gas Services, Inc. demonstrates a notable declining trend over the analyzed period, reflecting a gradual reduction in the company's efficiency in converting revenue into gross profit. At the end of December 2022, the gross profit margin stood at 62.23%, indicating a robust ability to maintain high margins on sales. This margin slightly decreased to 61.99% by March 2023 and further declined to 61.59% by June 2023, suggesting a relatively stable period with minor fluctuations.

However, starting from September 2023, the gross profit margin experienced a more pronounced decline, dropping to 59.62%, and continued its downward trajectory through the end of 2023 and into 2024. By December 2023, it had fallen to 53.28%, illustrating a significant reduction in gross profitability. The downward trend persisted through March 2024 and June 2024, with the margin reaching 47.92% and then 41.99%, respectively. The pressure on gross margins persisted throughout the subsequent quarters, with the margin declining to 37.89% as of September 2024.

Despite this continuous downward movement, a slight stabilization was observed in late 2024 and early 2025, with the gross profit margin marginally increasing to 38.01% at December 2024, then slightly rising to 38.19% in March 2025, and further improving to 40.02% by June 2025. This indicates potential signs of margin recovery or operational adjustments.

Overall, the trajectory of Kodiak Gas Services' gross profit margin reflects a substantial contraction over the analyzed period, which could be attributed to factors such as rising cost of goods sold, increased competitive pressures, or pricing pressures in their market. The partial recovery observed toward mid-2025 warrants further investigation to assess underlying causes and whether this trend signifies a sustainable turnaround or transient improvement.