Total profit — also called net profit or net income — is the money a company keeps after subtracting all expenses from revenue: COGS, operating expenses, interest, and taxes. It's the true bottom line, and it differs from gross profit (revenue minus COGS only) and operating profit (before interest and tax).
What Is Total Profit?
Total profit, also known as net profit or net income, is what a company keeps after covering every cost. It's the clearest single measure of financial health because it shows what the business actually earns once all expenses are paid.
Total Profit Formula
Total Profit = Revenue − COGS − Operating Expenses − Interest − TaxesThe true bottom line (net income)
Working down the income statement:
- Start with revenue (total income from sales).
- Subtract COGS (direct costs of producing what you sell).
- Subtract operating expenses (salaries, rent, marketing).
- Subtract interest on any borrowing.
- Subtract taxes.
Total Profit vs Gross Profit vs Operating Profit
| Profit type | What's subtracted |
|---|---|
| Gross profit | COGS only |
| Operating profit (EBIT) | COGS + operating expenses (before interest & tax) |
| Total / net profit | Everything — COGS, opex, interest, and taxes |
Why Total Profit Matters
- Profitability: shows how effectively the company manages all its costs.
- Financial health: consistent total profit signals a sustainable business.
- Investor interest: it's the figure investors weigh most when judging financial strength.
Total Profit FAQ
How do you calculate total profit?
Subtract all expenses from revenue: Total Profit = Revenue − COGS − Operating Expenses − Interest − Taxes. The result is net income, the bottom line of the income statement.
Is total profit the same as net income?
Yes. Total profit, net profit, and net income all refer to the same figure — what's left after every expense is paid.
What's the difference between total profit and gross profit?
Gross profit subtracts only COGS. Total profit subtracts everything else too — operating costs, interest, and taxes — so it's always lower and more complete.
What's the difference between total profit and operating profit?
Operating profit (EBIT) is profit from core operations before interest and taxes. Total profit takes those final costs out too, giving the actual bottom line.
