Net income is the final line of the income statement — revenue minus every cost of running the business. Divided by shares outstanding, it produces earnings per share (EPS).
It's a starting point, not the whole picture. Look at cash flow and debt to understand whether reported profits are real and sustainable.
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Open Decision Lab →Frequently asked questions
Same as profit?
Yes, usually. Net profit, net earnings, and net income all refer to the same line.
Related terms
EPS (earnings per share)
A company's profit divided by the number of shares outstanding.
Free cash flow (FCF)
Cash a business generates after paying to run and grow itself.
Gross income
Total earnings before taxes, deductions, or other withholdings.
Budget
A plan for how you'll spend and save money over a given period.
Cash flow
The difference between money coming in and money going out over a given period.
Saving rate
The percentage of take-home pay you keep rather than spend.