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Concept7 min read
Operating Margin
Operating margin is EBIT divided by revenue — the percent of each sales dollar that remains after paying all operating costs. It is the cleanest measure of how efficiently a business turns sales into profit before financing and taxes.
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What's inside
- Definition
- Why it matters
- Formula
- Units & benchmarks
- Key levers
- Where it shows up in cases
- How it's charted
- Worked example
- Common traps
- Industry nuances
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