Net Income
Total profit after all expenses, interest, and taxes.
Definition
Net income is the bottom line of the income statement—what remains after subtracting all costs including operating expenses, interest, taxes, and provisions from total revenue. It is the basis for earnings per share and dividends.
Formula
Net Income = Revenue - All Expenses - Taxes
Why It Matters
Net income drives EPS, which in turn drives stock valuations and dividend capacity. For banks, net income is particularly influenced by provision expense, making it more volatile than operating income during credit cycles.