Net Income

Net Income (Definition)

Net income is a companys total earnings (or profit), calculated by subtracting total expenses from total revenue.

Key aspects of net income include:

1. Also known as net profit, net earnings, or the bottom line
2. Represents the final profit figure after all expenses, including taxes, have been deducted
3. Found at the bottom of the income statement
4. Used to calculate earnings per share (EPS) for publicly traded companies
5. A key indicator of a companys profitability and financial health
6. Can be distributed to shareholders as dividends or reinvested in the company
7. Understanding net income trends is crucial for assessing a companys financial performance over time

Net income is a critical metric for investors, analysts, and management in evaluating a companys financial success.