this post was submitted on 18 Jun 2023
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Explain Like I'm Five

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What does it actually mean when they say "record profits?" (lemmy.world)
submitted 1 year ago by AyyShook@lemmy.world to c/explainlikeimfive@lemmy.world
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Obviously people are being price gouged, but just saying "record profits" without really being able to explain it feels like I'm just repeating what I've heard people say and not speaking on an informed level. What does it actually mean? Like before or after production and transportation costs? Before or after taxes? Raw product yeild? Something else?

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[โ€“] whatwhatwhatwhat@lemmy.world 2 points 1 year ago (1 children)

Profit refers to the money you have left over after you pay all of your operating expenses. These expenses would include employee salaries, inventory cost, rent, transportation, everything it takes to run your business.

So, record profit would mean that the company in question made more money than they ever had before.

[โ€“] CanadaPlus@lemmy.sdf.org 1 points 1 year ago* (last edited 1 year ago)

Even that's subject to a little fuckery, though. In absolute terms? Relative to valuation? Relative to the wider market? I imagine an actual analyst would be looking at the calculation used.