CRMNEUTRAL

Gross Margin

76.9%

Higher than 74% of Technology sector peers

Updated 533h ago

Sector Performance

74th percentile

CRM

76.9%

Sector Median

65.2%

Sector Avg

60.4%

📊

Deep Analysis

Salesforce’s gross margin of 76.9% means that for every dollar of revenue, the company keeps roughly 77 cents after covering the direct costs of delivering its software and services, a key measure of pricing power and cost efficiency.

This figure sits well above the sector median of 65.2% and places the company in the 73rd percentile among technology peers, indicating a strong competitive position on profitability. The year-over-year change is not available, but the latest quarter shows a decline of 0.9 percentage points from the prior quarter’s 77.6%, marking a small sequential contraction. Despite the high absolute level, the downward tick introduces a mild caution: the strong margin base limits near-term risk, but the negative quarterly trend warrants monitoring for any persistent erosion. This combination of a top-quartile margin and a slight quarterly dip suggests the company retains a pricing advantage, yet the direction could point to rising costs or pricing pressure. The metric supports the overall NEUTRAL verdict because the high margin confirms Salesforce’s profitability strength, while the small sequential decline prevents a more bullish outlook without further evidence of stabilization.

Frequently Asked Questions

What does the Gross Margin tell investors about CRM?

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.

How is the Gross Margin calculated?

Gross Margin is calculated as: Gross Profit / Revenue.

How does CRM's Gross Margin compare to its sector?

CRM's Gross Margin of 76.9% compares to a Technology sector median of 65.2%, placing it in the 74th percentile.

Who are CRM's closest peers by Gross Margin?

The closest Technology peers by Gross Margin include: ORCL (65.2%), MDB (72.2%), SAP (73.0%), LIF (77.3%), OKTA (77.8%).

The Formula

Gross Profit / Revenue

Why It Matters

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.