What is net profit?

Net profit (definition)

Net profit is the money you get to keep after all expenses and taxes are paid.

Net profit is often called the bottom line because it appears as the last line of your income statement after all expenses have been taken out.

The formula for net profit shows that gross profit minus operating expenses and taxes equals net profit.

Net profit is what the business gets to keep, which makes it one of the most important numbers people look at

Also called net earnings and net income, net profit can be distributed to business owners or reinvested into the business.

See other terms

Net profit margin

You can search for experts in our advisor directory

Find an advisor
Xero Small Business Guides

How to manage your finances and cash flow

Read article
Try Xero for free

Keep track of your performance with financial reporting

Find out more