Paychex Inc (PAYX)
Gross profit margin
| May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | May 31, 2020 | ||
|---|---|---|---|---|---|---|
| Gross profit | US$ in thousands | 3,799,000 | 3,554,100 | 3,255,400 | 2,785,600 | 2,759,700 |
| Revenue | US$ in thousands | 5,278,300 | 5,007,100 | 4,611,700 | 4,056,800 | 4,040,500 |
| Gross profit margin | 71.97% | 70.98% | 70.59% | 68.66% | 68.30% |
May 31, 2024 calculation
Gross profit margin = Gross profit ÷ Revenue
= $3,799,000K ÷ $5,278,300K
= 71.97%
Paychex Inc's gross profit margin has shown a consistent upward trend over the past five years, indicating an improvement in the company's ability to generate profit from its core operations. The gross profit margin increased from 68.30% in 2020 to 71.97% in 2024, reflecting a steady improvement in operational efficiency and cost management. This trend suggests that Paychex has been successful in controlling its cost of goods sold while increasing revenue, which is a positive sign for the company's profitability and overall financial health. The rise in gross profit margin demonstrates the company's ability to effectively manage its production or service costs, resulting in higher profitability for each dollar of sales.