Net income

RECENT NEWS
Wall Street Journal  Aug 29  Comment 
China's Dongfeng Motor Group reported a 54% rise in first-half net profit, thanks to sales gains in its joint ventures with Japanese and French car makers.
Forbes  Aug 29  Comment 
With a new pilot agreement in place, a few months back, the carrier began replacing the 50-seater regional jets in its fleet with the larger and more economical Embraer 76-seater regional jets. United says this replacement is bringing fuel savings...
newratings.com  Aug 29  Comment 
WASHINGTON (dpa-AFX) - Broadline closeout retailer Big Lots, Inc. (BIG) reported Friday higher net profit in its second quarter with increased net sales and comparable store sales, despite weak margins. Further, the company lifted the lower end of...
SeekingAlpha  Aug 29  Comment 
By Ben Kramer-Miller: Santacruz Silver Mining (OTCQX:SZSMF) just announced its second quarter earnings results. The company's one producing mine - Rosario - continues to lose money, although considering that it has only been in production for a...
Wall Street Journal  Aug 29  Comment 
PetroChina said its first-half net profit rose 4% from a year earlier after its refining business swung to a profit and its chemicals business narrowed its loss.
SeekingAlpha  Aug 29  Comment 
New York Times  Aug 29  Comment 
Earnings for April through June gained $2 billion, or 5.3 percent, from $38.2 billion in the same period of 2013.
Motley Fool  Aug 28  Comment 
Splunk’s big-ticket growth story continues to gain momentum, with solid earnings beats on both the top and bottom lines in its most recent quarterly report.
SeekingAlpha  Aug 28  Comment 
Wall Street Journal  Aug 28  Comment 
PetroChina said its first-half net profit rose 4% from a year earlier after its refining business swung to a profit and its chemicals business narrowed its loss.




 

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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