Revenue

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Cloud Computing  Apr 3  Comment 
NEW YORK , April 3, 2014 /PRNewswire/ -- World Assurance Group Inc. (www.worldassurancegroup.com) (OTC Pink: WDAS) today announces that it has added two additional solar power plants to its existing license agreement, generating $750,000 in...
SeekingAlpha  Apr 2  Comment 
By Lisa Thompson: Today TowerJazz (TSEM) closed its joint venture agreement with Panasonic (OTCPK:PCRFY) by issuing 870,454 shares ($7.5 million in value) in exchange for 51% of a joint venture that is expected to add $400 million in annual...
Forbes  Apr 2  Comment 
The Association of American Railroads, an industry trade group representing primarily the major freight railroads of North America, argued that the loss arising from the proposal far outweigh the benefits. The Association of American Railroads...
SeekingAlpha  Apr 1  Comment 
ByElephant Analytics: One question surrounding BlackBerry (BBRY) is how low service revenues will fall before they bottom out. While BlackBerry is focusing on becoming more of an enterprise software company, service revenues will remain an...
Financial Times  Apr 1  Comment 
ICAP says revenues at its global broking business fell 14 per cent year-on-year in past two months, as it battled becalmed markets and regulation fears
newratings.com  Mar 31  Comment 
WASHINGTON (dpa-AFX) - Brokerage company BGC Partners Inc (BGCP) said Monday it expects first-quarter results to be about the high-end of the range of its previous guidance. In Feb, BGC projected first-quarter revenues of $410 million to $440...
SeekingAlpha  Mar 31  Comment 
By 3D Analytics: Introduction Shares of VAPE Holdings Inc. (OTCQB:VAPE) have risen from less than $1 per share to a high of $41.25 after the one-time social-network company changed its business operations to pursue opportunities in the...
The Economic Times  Mar 30  Comment 
As per the rules, both the operators have to pay SUC of 1 per cent for spectrum in 2300 MHz band and 5 per cent for the newly acquired spectrum.
guardian.co.uk  Mar 28  Comment 
Shares rise as losses were smaller than had been expected and chief executive says operations have been 'significantly streamlined' in previous year Struggling smartphone maker BlackBerry saw its quarterly revenues fall below $1bn (£601m) for the...
newratings.com  Mar 28  Comment 
LONDON (dpa-AFX) - ITE Group plc (ITE.L), an organizer of trade exhibitions and conferences, Friday said it expects higher revenues in its first half, despite negative currency movements. Like-for-like revenues are 2 percent below last year on an...




 

The term revenue most commonly refers to Net Revenue but it can also be used as Gross Revenue.

Revenue is the total amount of money a company takes in before any expenses.

Net Revenue is the amount of a company's gross revenue plus all negative revenue items. For instance, in the retail industry, gross revenue includes all sales made by a retailer during the accounting period. Net revenue, however, will also exclude the costs associated with items like refunds on returned items, discounts and other negative sales revenue items.

Often times, net revenue can refer to revenue a company receives after it pays its partners. For example, Google (GOOG) arrives at net revenue by subtracting Traffic Acquisition Costs (TACs) from its gross revenue. TACs are comprised of payments made to its Adsense network partners (Google ads displayed on third-party websites are subject to a revenue sharing program), as well as fees related to non-conventional partnerships (such as Google being the first search engine listed in the Mozilla Firefox built-in search toolbar).

This is a subtle difference from Cost of Goods Sold (COGS) - in the case of TACs, these are costs directly related to generating revenue (which is then split between different partners). COGS, on the other hand, refers to overhead and "manufacturing" costs related to the production of goods sold. Analogously, Google's COGS would include expenses incurred in data center operations.

Ratio analysis can be implemented and utilised for the comparative measurement of financial data among several companies of the same industry to facilitate wise investment, as ratios in general involve a process of standardization. Two main indicators-ratios can be used for the evaluation of a company's performance:

  1. Activity ratios: Asset Turnover or Efficiency Ratio = Total Revenue/ Assets

Activity ratios describe the relationship between the company's level of operations(usually defined as sales and the assets needed to sustain the activity). The higher the ratio, the more efficient the company's operations, as relatively fewer assets are required to maintain a given level of operations(sales), or the company expoits its assets in an efficient way maximising its sales. Monitoring the trends in these ratios over time and in comparison to other firms in the industry, can point out potential trouble spots or opportunities that would facilitate investing decisions.

  1. Profit Margins or Return on Sales or Profitability ratio = Profit/Revenue

It is a measure of a company's profitability and it is the relationship between the company's costs and its sales. The profitability ratio indicates the proportion of Revenue that form the company's profit, after deducting any operating and other expenses the company has. It can be also interpreted as the proportion of profits generated from each dollar of sales, showing how profitable a company is.

  1. Return on Assets (ROA) = ( (Net Income/Sales) * (Sales/Assets) )

This ratio is a combination of the two aforementioned ratios that can be summarised in the term Return on Assets, that measures the overall productivity of assets.

Net Revenue versus Total Revenue

Net Revenue (also Revenue, Net Sales, or Sales) is the total revenue or gross revenue minus the costs associated with returned or undelivered goods and commissions. Total Revenue or Gross Revenue on the other hand is simply all positive revenues. This distinction is particularly important for certain sectors like banking which relies heavily on commissions and Retail which can experience frequent returned items.[1]

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