Definition

The magical number left over after you subtract all expenses from revenue, assuming your accounting department is feeling generous about what counts as an expense. It's what companies supposedly exist to generate, though many startups operate for years as if this is merely optional. Shareholders love it, the IRS wants to tax it, and CFOs have seventeen different ways to calculate it.

Example Usage

We're finally profitable if you don't count marketing expenses, R&D, that lawsuit, or basic accounting principles.

Source: Financial terminology via Dictionary definitions

Related Terms

Advanced

revenue recognition

The accounting principle determining when revenue should be recorded, which sounds simple until you encounter multi-year contracts, partial deliveries, and customers who might return products. Getting this wrong is how good companies become accounting scandals.

💰 Finance / Accounting
Beginner

payout

The glorious moment when money actually leaves the vault and enters someone's pocket, whether it's dividends to shareholders or winnings to lottery players. In corporate speak, it's the amount distributed to investors who've been patiently waiting for their returns. The favorite word of anyone who's ever invested in anything, and the dreaded term for CFOs watching the bank account drain.

💰 Finance / Accounting
Intermediate

Related Party Transaction

Business dealings between a company and its insiders, subsidiaries, or affiliates, requiring disclosure because the potential for self-dealing is obvious. It's where conflicts of interest get documented rather than avoided.

💰 Finance / Accounting
Beginner

financing

The art of obtaining money for a venture, purchase, or operation, typically through loans, investments, or creative accounting that would make your grandmother worry. In real estate and business, it's the difference between owning something outright and owing a bank for the next 30 years. Everyone says they're 'exploring financing options' which usually means 'we're broke but optimistic.'

💰 Finance / Accounting
Intermediate

sunk cost fallacy

The irrational commitment to failing projects because you've already wasted so much time and money that stopping now would mean admitting it was all pointless. It's throwing good money after bad while calling it 'persistence.'

💰 Finance / Accounting
Intermediate

horizontal analysis

Comparing financial statement line items across multiple periods to identify trends and growth patterns. It's the accounting equivalent of looking at your bank balance history and realizing why you're broke.

💰 Finance / Accounting

Translate This Term

See “profit” in Corporate Speak, Gen-Z Slang, Pirate Speak, and more.

Try the Translator

Share This Term

Post on XShare on FacebookShare on LinkedIn

Discover a Term

Beginner

DT

StarCraft 2players use DT to refer to the Dark Templar, a dangerous Protoss unit. The DT is a permanently-cloaked assass...