What is profit margin? How to use in English

Definition & pronunciation of profit margin

profit marginnoun
biên lợi nhuận
/ˈprɒfɪt mɑːdʒɪn//ˈprɑːfɪt mɑːrdʒɪn/

Where does the word profit margin come from?

The term "profit margin" refers to the portion of a company's revenue that remains after deducting all the necessary costs of producing or selling a product or service. In simpler terms, it is the difference between the selling price of a product or service and the costs required to produce or sell it, expressed as a percentage of the revenue. The expression "profit margin" gained popularity in the 20th century as businesses began to focus more on financial metrics to measure and optimize their performance. It provides insights into the overall health and efficiency of a company's operations, helping investors, stakeholders, and managers to make informed decisions.

Example of vocabulary profit marginnamespace

The company's profit margin for the last quarter showed a considerable increase, signaling strong financial health.
Due to the successful implementation of cost-cutting measures, our profit margin this year has exceeded industry standards.
The company's profit margin has been consistently decreasing over the past few years, indicating the need for strategic planning to address underlying issues.
The new product line has resulted in a higher profit margin, proving its successful integration into our business model.
Despite a challenging market environment, our profit margin has remained relatively stable, highlighting our resilience as a company.