Net Income

RECENT NEWS
MarketWatch  28 min ago  Comment 
Tyson Foods Inc. shares are up 4.4% in premarket trading after after meat company reported first-quarter earnings that exceeded expectations and the company raised its earnings guidance. Tyson had net income of $461 million, or $1.15 per share,...
newratings.com  49 min ago  Comment 
newratings.com  5 hrs ago  Comment 
The Economic Times  8 hrs ago  Comment 
This earnings season, the market has showered love on companies which have reported strong growth while mercilessly punishing those which have not.
MarketWatch  Feb 5  Comment 
LinkedIn Corp., the social network for job seekers and recruiters, is forecasting slower growth this year amid confusing jargon, fueling fears among investors that its go-go, high-growth days are behind it.
The Hindu Business Line  Feb 4  Comment 
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newratings.com  Feb 4  Comment 
WASHINGTON (dpa-AFX) - Hartford Financial Services Group Inc. (HIG) released a profit for its fourth quarter that advanced compared to the same period last year. The company said its bottom line climbed to $445 million, or $1.07 per share. This...
Wall Street Journal  Feb 4  Comment 
AstraZeneca PLC warned earnings would fall this year as it continues to plow investment into research and development and expects a sharp drop in sales for one of its blockbuster drugs, surprising investors and sending shares down more than 5%.
Reuters  Feb 4  Comment 
* Plans $13 bln capex, down from $14.7 bln spent last year (Recasts, adds comments, cost-cutting details, shares)
Motley Fool  Feb 4  Comment 
Mobile search is driving revenue higher and YouTube is as hot as ever. Here's a look at these growth drivers, along with other key metrics that impressed investors.
Benzinga  Feb 3  Comment 
General Motors Company (NYSE: GM) is estimated to report its quarterly earnings at $1.22 per share on revenue of $39.03 billion. GoPro Inc (NASDAQ: GPRO) is projected to post its quarterly earnings at $0.00 per share on revenue of $496.10...
newratings.com  Feb 2  Comment 
ROSELAND (dpa-AFX) - Automatic Data Processing Inc. (ADP) revealed earnings for its second quarter that advanced compared to the same period last year. The company said its bottom line rose to $332.8 million, or $0.72 per share. This was higher...




 

Net Income is the total amount of profit a company made over a given period of time

Net Income, (sometimes referred to as "net profit", or simply "earnings") is the amount of profit left over after all expenses, including federal and state taxes, have been subtracted. More specifically, it is equal to total revenue less cost of revenue, less operating expenses, less interest expense and income taxes, less or plus extraordinary items, less or plus other items. More simply, it is gross profit minus total operating expenses, minus interest expenses and taxes, plus any other income.

On a very high level, net income can be thought of as all money coming into the company minus all money spent.

Net income is often referred to as "income attributable to common shareholders" or some similar phrase. Net income represents the final net earnings result of the business on an accounting basis, not necessarily a cash basis. It is one of the most frequently tracked metrics because it is an important indicator of how well a company is doing during a particular period. When people refer to the "bottom line" they are talking about a company's net income as it is the last line on the income statement and the most significant number on the statement - arguably of any statement.

Net income is usually divided by the number of shares outstanding to arrive at earnings per share (EPS), the common barometer heard in nearly all financial reports because it provides an individual value to every share exchanged of a company. Most analysts and investors focus on "diluted" earnings per share, which figures in outstanding employee stock options and other equity grants beyond actual shares outstanding in the share markets.

Net Income also appears as the top line of the cash flow statement and represents the starting figure from which Change in Cash and Cash Equivalents is calculated. That saves me. Thanks for being so senslibe!

Example

  • At the close of its fiscal year, Company XYZ reports revenue of $17 million with a cost of revenue of $7 million (equaling a gross profit of $10 million). Operating expenses total $5 million while the company owes $2.5 million in income taxes and $.5 million in interest expenses. The company also reports other income of $2 million. Thus, XYZ's net income for the fiscal year is $4 million. (17 - 7 - 5 - 2.5 - .5 + 2 = 4)
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