Legal Definitions - net revenue

Net revenue is the amount of money a business earns after subtracting all the expenses from the total revenue. It is also known as net profit. This is the money that the business can keep after paying all the bills and taxes.

• Gross profit: This is the total sales revenue minus the cost of goods sold. For example, if a company sells $100 worth of products and the cost of goods sold is $50, the gross profit is $50.
• Net profit: This is the total sales revenue minus all the expenses, including the cost of goods sold, salaries, rent, and taxes. For example, if a company earns $100 in revenue and has $50 in expenses, the net profit is $50.
• Operating profit: This is the total sales revenue minus all the operating expenses, such as salaries, rent, and utilities. It does not include non-operating income and expenses, such as interest payments. For example, if a company earns $100 in revenue and has $30 in operating expenses, the operating profit is $70.

These examples illustrate how net revenue is calculated and how it differs from other types of profit. Net revenue is important because it shows how much money a business is actually making after all the expenses are paid. This is the money that can be reinvested in the business or distributed to shareholders as dividends.