Revenue

How to read it

Revenue is the top line of the income statement: the amount a company reports it earned from its sales in the period. It rises when the company sells more, charges higher prices or adds businesses, and falls when volumes, prices or the business itself shrink. stockrow shows it for the trailing twelve months, for each quarter and for each fiscal year; the statement tables show it in millions.

What is typical

Its size says little on its own, because it depends on the scale and the kind of business. A retailer or distributor turns over a great deal of revenue on thin margins, while a software or drug company can earn far more profit from far less. Seasonal businesses show quarterly revenue that swings through the year, so the trailing-twelve-month figure is the steadier view. Compare its growth with the median for the company’s sector rather than comparing raw totals.

Pitfalls

Revenue is the starting point for many other figures on stockrow — the revenue growth rates, the price-to-sales and EV/sales ratios, the gross, EBIT, net profit and free cash flow margins, asset turnover and revenue per share among them — so a one-off jump or an acquisition flows through all of them. Revenue says nothing about whether the sales were profitable or collected in cash.