Net Profit Explained

Net Profit

What is Net Profit?

Net profit — also known as the bottom line — is what remains after all business expenses, taxes, and interest are deducted from total revenue.

Explanation

Net profit is a core indicator of business success and is calculated as:

Net Profit = Revenue – (COGS + Operating Expenses + Interest + Tax)

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A positive net profit shows that the business is not only earning but also retaining money after all obligations.

Practical Example of Net Profit

A bakery earns £200,000 in revenue. After all costs and taxes, £30,000 remains. That’s the net profit.

How Bizcap Can Help:
Want to boost your bottom line? Bizcap funding can support cost-saving initiatives, revenue-generating projects, or refinance high-cost debt.

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