Definition:
Net margin is a ratio of net profit to revenue as a percentage.
Example:
If your net income is $100 and your sales were $1,000 then your net margin will be $100 / $1,000 = 10%.
Why it matters:
Net margin is a useful measure of how profitable a company is. Expressing profitability as a percentage helps compare different companies of different sizes.
Definition:
Net margin is a ratio of net profit to revenue as a percentage.
Example:
If your net income is $100 and your sales were $1,000 then your net margin will be $100 / $1,000 = 10%.
Why it matters:
Net margin is a useful measure of how profitable a company is. Expressing profitability as a percentage helps compare different companies of different sizes.