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Gross profit

Revenue less the cost of what was sold: what is left before selling and administrative costs, interest and tax.

Formula

\text{Gross profit} = \text{Revenue} - \text{Cost of sales}

Taken from the income statement for the period under one standard: IFRS and Russian accounting figures are never mixed, because their perimeters differ.

How to read the number

The first line of defence in profitability: if gross profit does not cover fixed costs, the problem is in price or in costs, not in management.

When the metric lies

Banks and insurers have no such measure: cost of sales in the usual sense does not exist for them.

Where it is used

The metric is calculated across every security in the catalogue and appears on the instrument card, in the multiples table and in the screener.

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