SaaS & Subscriptions / Finance
SaaS Gross Margin
The percentage of revenue left after the direct cost of delivering the service.
The fork, why two teams get different numbers
There is no SaaS-specific COGS standard, so what lands in cost of revenue is a policy choice that swings margin by fifteen to twenty-five points.
In the Metric Library
- The full fork, both definitions worked all the way through
- The trap that makes the number lie, on a real export
- Every formula variant, spelled out
- The reconciliation anchor, what to tie it to and when to refuse
Reference: US GAAP income-statement presentation (cost of revenue) · FASB ASC 350-40 (internal-use software amortization) · SEC Regulation S-X · SaaS operating-metric convention (no single standards body)