Watsco Inc (WSO)
Gross profit margin
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Gross profit | US$ in thousands | 1,992,140 | 2,030,290 | 1,667,540 | 1,222,820 | 1,156,960 |
| Revenue | US$ in thousands | 7,283,770 | 7,274,340 | 6,280,190 | 5,054,930 | 4,770,360 |
| Gross profit margin | 27.35% | 27.91% | 26.55% | 24.19% | 24.25% |
December 31, 2023 calculation
Gross profit margin = Gross profit ÷ Revenue
= $1,992,140K ÷ $7,283,770K
= 27.35%
Watsco Inc.'s gross profit margin has shown a fluctuating trend over the past five years. In 2023, the gross profit margin decreased to 27.35% from 27.91% in 2022. Despite this slight decline, it is worth noting that the gross profit margin in 2023 is still higher compared to the margins recorded in 2021, 2020, and 2019, which were 26.55%, 24.19%, and 24.25%, respectively.
The consistent improvements in the gross profit margin from 2020 onwards indicate enhanced efficiency in managing production costs and generating revenue from sales. However, the slight dip in 2023 suggests potential challenges in maintaining or further increasing profitability through cost control measures or pricing strategies.
Overall, while Watsco Inc. has made progress in enhancing its gross profit margin in recent years, it may need to focus on strategies to sustain or improve this key financial metric in the future to ensure continued profitability and competitiveness in the market.