Explore jobs
Find specific jobs
Explore careers
Explore professions
Best companies
Explore companies
This question is about employer.
Revenue vs. earnings
Revenue and earnings are two different ways of assessing company profit. Revenue is the income a company generates before deducting expenses. Earnings, on the other hand, represent the profit a company has earned; it is calculated by subtracting expenses, interest, and taxes from revenue.
Revenue is the total amount of money earned by a company for selling its goods and services. Many analysts use the terms revenue and sales interchangeably. Companies usually report their revenue on a quarterly and annual basis in their financial statements. A company's financial statement includes its balance sheet, income statement, and cash flow statement.
Earnings, by contrast, reflect the bottom line on the income statement and are the profit a company has earned for a period. The earnings figure is listed as net income on the income statement. When investors and analysts speak of a company's earnings, they're talking about the company's net income or profit.
Revenue is called the top line because it sits at the top of a company's income statement, which also refers to a company's gross sales. Revenue is the income generated before expenses are deducted. Revenue is also called net sales for some companies since net sales include any returns of merchandise by customers.
While a company calculates its earnings by subtracting from its revenue the costs of doing business, such as depreciation, interest charges paid on loans, general and administrative costs, income taxes, and operating expenses such as rent, utilities, and payroll. A company's bottom line is also called earnings or net profit.
At the end of the day, both revenue and earnings are both important financial metrics, but it is impossible to determine which one is better without understanding the specific context. Revenue is the amount of money an organization takes in through sales or services over a certain period of time. Earnings refer to the amount of profit that an organization makes after subtracting its expenses from its revenue. Depending on the organization and its goals, either revenue or earnings may be more important.
| Revenue | Earnings |
|---|---|
| Definition: The total amount of money a company brings in from its business activities over a given period of time. | Definition: The net income, or profit, a company makes after all expenses are deducted from its revenues. |
| How It's Calculated: Revenue is calculated by subtracting the cost of goods sold from the total amount of sales. | How It's Calculated: Earnings are calculated by subtracting all expenses, including taxes, from total revenues. |
| Impact on Business: Revenue is a measure of how much a business is generating from sales. | Impact on Business: Earnings are a measure of how much profit a business is making after all expenses are taken into account. |
Choose from 10+ customizable resume templates
Zippia allows you to choose from different easy-to-use templates, and provides you with expert advice. Using the templates, you can rest assured that the structure and format of your resume is top notch. Choose a template with the colors, fonts & text sizes that are appropriate for your industry.
