The gross margin (gross profit ÷ revenue) shows pricing power and production efficiency. It represents profitability before operating expenses.
Source: TMS 1
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RevenueIncome arising in the course of an entity's ordinary activities.EBITDAEarnings before interest, tax, depreciation and amortisation; used as an indicator of the cash-like profitability generated by a company's core operations.Operating profitProfit calculated by deducting operating expenses such as marketing, general administration and R&D from gross profit and adding other income and expenses from main operations.Accounting estimatesThe determination by management judgement of amounts that cannot be measured precisely, such as provisions, useful lives, expected credit losses and fair values.Accounting policiesThe specific principles, bases, conventions, rules and practices an entity applies in preparing its financial statements.Accrual basis of accountingThe principle of recording transactions as income, expenses, assets and liabilities in the period in which they occur, rather than when cash is received or paid.
Last updated: October 31, 2026 · This definition is for general information only.