Infinera: Gross Margins by Segment 2020

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This statistics shows us Infinera – margins by segment 2020. Profit margin is a profitability ratio which measures how much of the total revenue is converted into profit.
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By Sankul Iyer

This statistics shows us Infinera – margins by segment 2020. Profit margin is a profitability ratio which measures how much of the total revenue is converted into profit. It is expressed in percentage terms and is computed as follows:

Profit margin = (Net sales – COGS)/Net sales

Importance of tracking margins by the segment The profit margin of a product or service determines how much it sells above the actual cost. That is, it reveals the markup in the selling price.

Analysis of the performance 

Let’s analyse the performance of Infinera based on the margins by segment. The product margins were recorded at 21.76% in the second quarter of FY 2019. This was a 7.47% fall from the previous quarter and a 15% fall from the second quarter of the previous fiscal year. The product segment of Infinera faced a downtrend from the third quarter of FY 2016 to the last quarter of FY 2017. In Q1 FY 2018, there was a 9.32% increase from Q4 FY 2018. This increase reduced to 8.23% in Q1 FY 2019. The highest profit margin was of 37.27% which took place in the first quarter of FY 2018.

In Q2 FY 2018, there a service profit margin of 60.41%, which dropped to 46.92% in Q2 FY 2019. In fact, the service margins of Infinera dipped below 50% for the first time in each of the first two quarters of FY 2019. Q4 FY 2018, there was an 8.33% decline from the previous quarter, which was the maximum quarterly decline faced by this segment. The highest growth, on the other hand, was of 7.69% from the first to the second quarter of FY 2017. This preceded by a 7.89% decline from the first to the second quarter of FY 2017.

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