Profit margin

• Indicator of profitability. The ratio of earnings available to stockholders to net sales. Determined by dividing net income by revenue for the same 12-month period. Result is shown as a percentage.

• Measures the percentage of each sales dollar remaining after all expenses, including financing expenses and taxes have been deducted.

• See Pre-tax Profit on Sales.


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 Embedded terms in definition
Net income
Net sales
 Related Terms

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