8 days ago • Posted by William Ramstein

Squarespace, a website hosting business, sees high gross margins versus peers

While Squarespace has slower revenue growth than peers we note that the company’s gross margins are higher than peers’ average of 62%. Squarespace’s higher than average gross margins reflect the company’s quality high margin software revenue which somewhat redeems the company’s slower than average revenue growth. The company has also improved gross margins by 200bps over the past three years, from 82% in 2018 to 84% 2020, which positively signals to us management’s capability of cost management. Source: BoA