Net Profit Margin (Investments & Retirement) - Definition, Examples, Advice | Bolder Money

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Definition

The percentage of revenue that remains as profit after all expenses are deducted, showing how efficiently a company operates.

What to consider

Use this metric to gauge how efficiently a company converts revenue into profit.
Compare margins across companies in the same industry.
Monitor changes over time to assess overall business health.

Real world scenarios

After reviewing the quarterly report, Oliver was impressed by his company’s net profit margin, which indicated efficient cost management and strong profitability.

Related terms

Investments & Retirement

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