Net Profit Margin or Profit Margin shows a company's profitability, indicating how much profit is earned per euro of revenue. It also reflects the effectiveness of the company's pricing strategy and cost management.
$$\text{Net Profit Margin} = \frac{\text{Net Profit}}{\text{Net Sales}}$$
The net profit margins of different companies are not easily comparable because their cost structures are usually very different.
Profit Margin FAQ
What is profit margin?
It is the share of sales left as net profit.
How do you calculate it?
Divide net profit by net sales.
