Net margin
Net income divided by revenue.
Plain languagePractical exampleConnected reading
01
What is it?
Net income divided by revenue.
02
Why does it matter?
It shows the final result of operations, financing, tax and one-offs relative to sales.
03
How should it be read?
Separate continuing operations, minority interests and one-off items.
04
Common mistake
Assuming every increase reflects operating improvement.
A simple example
Net income of 10 on revenue of 200 implies a 5% net margin.