Parsons Corp (PSN)

Gross profit margin

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Gross profit	US$ in thousands	308,444	191,672	29,835	-68,131	1,522
Revenue	US$ in thousands	6,706,840	5,418,280	4,176,290	3,641,260	3,902,880
Gross profit margin		4.60%	3.54%	0.71%	-1.87%	0.04%

December 31, 2024 calculation

Gross profit margin = Gross profit ÷ Revenue
= $308,444K ÷ $6,706,840K
= 4.60%

The gross profit margin of Parsons Corp has shown varying trends over the years based on the provided data. In December 2020, the gross profit margin was 0.04%, indicating that the company had a very slim margin between its revenue and cost of goods sold. This slim margin suggests potential challenges in controlling production costs.

By December 2021, the gross profit margin declined significantly to -1.87%, indicating that the company's cost of goods sold exceeded its revenue, resulting in a loss at the gross profit level. This negative margin is a concerning sign and may indicate inefficiencies in the company's operations or pricing strategies.

However, there was an improvement in December 2022, with the gross profit margin increasing to 0.71%. While still relatively low, this improvement suggests that the company may have made some adjustments to control its production costs or increase its selling prices.

In December 2023, the gross profit margin further improved to 3.54%, signaling a more substantial increase in profitability. This improvement indicates that Parsons Corp was able to effectively manage its costs and generate a healthier margin between its revenue and cost of goods sold.

The most recent data point in December 2024 shows a gross profit margin of 4.60%, continuing the positive trend of increasing profitability. This significant improvement suggests that the company's strategies to enhance profitability, such as cost controls, pricing optimization, or operational efficiency, have been successful.

Overall, the analysis of Parsons Corp's gross profit margin demonstrates fluctuations over the years, with notable improvements in recent periods. A consistent focus on managing costs and improving operational efficiency will be crucial for the company to sustain and further enhance its profitability in the future.