Finance Library
BusinessBeginner 4 min read
Revenue vs Profit
Big top line, small bottom line — why the gap matters.
Revenue
$1000
− COGS
$600
− OpEx
$380
− Taxes
$220
Net Profit
$150
Revenue
Revenue is the total money a business takes in from sales — before any costs are subtracted. It tells you size, not health.
Profit
Profit is what's left after you subtract the cost of producing the product (COGS), operating expenses, interest, and taxes. A company can have huge revenue and still lose money.
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