PDB Academy

Academy › Glossary › Fundamentals

Operating margin

The share of revenue left after operating expenses, before interest and tax.

FundamentalsBeginner

Definition

Operating margin shows how profitable the core business is. Rising operating margin as revenue grows is called operating leverage.

Formula

Operating margin = operating income / revenue

Learn it in context with PDB Academy

Guides, short videos and a plain-English glossary in one place, with tools to try each idea on real market data. The basics are free.

Create a free accountOpen PDB Academy