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Operating income

What is operating income?

Operating income is a measure of the profit a company makes from its core business operations, before accounting for interest and taxes. It provides insight into a company's operational efficiency and its ability to generate profit excluding non-operating activities.

Operating income, often referred to as operating profit or EBIT (Earnings Before Interest and Taxes), is calculated by subtracting the cost of goods sold (COGS), operating expenses, and depreciation and amortization from a company's gross revenue. It's a useful metric to compare the performance of companies within the same industry or to assess the efficiency of a company's management over time.

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