Profitability

/ˌprɒfɪtəˈbɪlɪti/

Meaning & Definition

noun

The state or condition of yielding a financial profit or benefit.

The company's profitability improved significantly after they streamlined their operations.

The degree to which a business or investment yields a profit.

Investors are always looking for opportunities with high profitability.

The capacity to generate earnings as compared to the expenses incurred.

The profitability of the project will be evaluated after the first quarter.

A measure of financial success, typically expressed as a ratio of profit to revenue or investment.

Higher profitability ratios indicate better financial health for the business.

Derived from the word 'profit', combined with the suffix '-ability' indicating a quality or state.

profit margin

The difference between sales and net income, expressed as a percentage of sales.

return on investment

A measure used to evaluate the efficiency or profitability of an investment.

break-even point

The point at which total revenues equal total costs, resulting in neither profit nor loss.

profit

The financial gain made in a transaction.

revenue

The total income generated from business operations.

cost

The amount of resources expended for something.

In the black

The company is finally in the black after years of losses.

In the green

Once the sales increase, we should be in the green by next quarter.