Net Profit Margin
Net profit margin measures the profit that a company produces from its total revenue, and this value is expressed as a percentage. Also known as net margin, this business metric is one of the biggest indicators of overall financial health of a company and is often used to evaluate a company’s success over time.
The formula for net profit margin is as follows:
Net Profit Margin =
R – COGS – O – I – T x 100
R
Where R = Revenue, C = Cost of goods sold, O = Operating and other expenses, I = Interest, T = Taxes
