Net Income

What is Net Income?

Net income, often called the bottom line, is the total profit of a company after all expenses, including taxes and interest, have been deducted from total revenue. It represents the actual amount of money a business has earned during a period.

Why It Matters

• It is the ultimate measure of a company’s profitability and success over a specific timeframe.

• Net income is used to calculate earnings per share, a key metric for investors in public companies.

• It can be either distributed to shareholders as dividends or kept as retained earnings for future growth.