Operating margin
Operating Profit Margin (EBIT Margin)
Profitability RatiosOperating profit (EBIT) as a percentage of revenue. It captures the profitability of the core business after all operating costs but before interest and tax.
Formula
Operating Margin = EBIT / Revenue
Why it matters
It is the margin most comparable across companies in a sector, since it excludes financing structure. Durable margin expansion is one of the strongest drivers of shareholder value.
Indian example
Related terms
Learn the concept
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