Gross Margin 5 Year Average
Returns the five-year average gross margin for a company. Gross margin measures what percentage of revenue remains after deducting the cost of goods sold.
Supported Symbol Formats
| Type | Format | Example |
|---|---|---|
| US Stocks | SYMBOL | AAPL, MSFT |
Formula
Gross Margin = (Revenue - Cost of Goods Sold) / Revenue
Industry Benchmarks
| Industry | Typical Gross Margin |
|---|---|
| Software | 60-80% |
| Pharmaceuticals | 60-70% |
| Consumer Goods | 30-50% |
| Retail | 20-30% |
| Grocery | 10-15% |
Notes
- Returns value as a decimal (0.40 = 40%)
- Higher margins indicate pricing power
- Compare within same industry
Syntax
=GrossMarginFiveYearAverage(Symbol)Examples
=GrossMarginFiveYearAverage("AAPL")=GrossMarginFiveYearAverage("MSFT")=GrossMarginFiveYearAverage("WMT")Symbol from cell reference
=GrossMarginFiveYearAverage("AAPL")*100When to Use
- Assess product profitability
- Compare pricing power across companies
- Analyze business model efficiency
- Track margin trends over time
When NOT to Use
| Scenario | Use Instead |
|---|---|
| EBITDA margin | EBITDAMarginFiveYearAverage() |
| Net profit margin | NetMarginFiveYearAverage() |
| One-year margin growth | GrossProfitMarginOneYearGrowth() |
| Current gross margin | Current margin functions |
Common Issues & FAQ
Why is the value less than 1?
Gross margin is returned as a decimal. Multiply by 100 to get percentage (e.g., 0.40 = 40%).
Why are software companies' margins so high?
Software has minimal cost of goods sold (mostly just server costs), resulting in high gross margins. Hardware or retail companies have significant COGS.
What's the difference between gross margin and gross profit?
Gross margin is a percentage (relative), while gross profit is a dollar amount (absolute). Margin allows comparison across company sizes.
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