Vital Energy Inc. (VTLE)

Gross profit margin

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Gross profit	US$ in thousands	400,924	893,103	1,061,030	492,587	-550,267
Revenue	US$ in thousands	1,753,840	1,491,170	1,495,400	820,641	661,355
Gross profit margin		22.86%	59.89%	70.95%	60.02%	-83.20%

December 31, 2024 calculation

Gross profit margin = Gross profit ÷ Revenue
= $400,924K ÷ $1,753,840K
= 22.86%

Vital Energy Inc.'s gross profit margin has displayed significant fluctuations over the past five years. The margin was negative at -83.20% in December 31, 2020, indicating that the company's cost of goods sold exceeded its revenues by a considerable margin. However, there has been a remarkable turnaround since then, with the gross profit margin improving to 60.02% by December 31, 2021, and further increasing to 70.95% by December 31, 2022. These improvements suggest that Vital Energy has been able to effectively control its production costs and/or increase its selling prices.

The company experienced a slight decline in the gross profit margin to 59.89% by December 31, 2023, but it remained relatively strong compared to the initial negative margin. The most recent data point shows a significant decrease in the gross profit margin to 22.86% by December 31, 2024. This could indicate that Vital Energy may be facing challenges such as increased production costs, pricing pressures, or changes in sales mix impacting profitability.

Overall, Vital Energy's gross profit margin trend demonstrates a mixed performance, with notable improvements in the middle years but a decline in profitability in the most recent period. It would be important for the company to analyze the underlying reasons for these fluctuations and take appropriate actions to maintain or enhance its profitability in the future.