Operating income is a value that is used to demonstrate a company’s profitability after it has deducted other costs such as cost of goods sold (COGS), employee wages and other operating expenses. This ...

Most investors are familiar with calculating return on investment, or ROI. It's one of the most-common metrics used to determine an investment's success or failure. You may not, however, be as ...

Learn about gross, operating, and net profit margins, how each is calculated, and how businesses and investors can use them to analyze a company’s profitability.

Your company's operating cycle provides a gauge of how long it has cash tied up in operations, which is why it's also commonly referred to as the cash conversion cycle. The operating cycle is a rough ...

Operating income reveals how much profit or loss a business earns or incurs before taking interest expenses and taxes into account. As the name implies, operating income measures the profitability of ...

The goal of every company is to become profitable, but it often takes time for a business to achieve that goal. Most companies have fixed costs it has to cover as part of doing business, and there are ...

Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. Andy Smith is a Certified Financial Planner ...

Operating cash flow, or OCF, refers to the amount of cash a company generates from normal business operations over a specific period of time. It’s widely used to evaluate a company’s performance and ...

Either method of calculation delivers the operating income figure that is divided by revenue to bring in the operating margin. The difference between the two is the approach on profit: Operating ...