Operating margin is the percentage of profit a company makes on each dollar of revenue.
Operating margin is calculated by dividing net income by net revenue.
For example, if a company has net income of $100,000 and net revenue of $1,000,000, its operating margin is 10%.
Operating margin is a great way to determine how profitable a company is. It's also a great way to compare profitability between companies.
For example, if Company A has an operating margin of 10% and Company B has an operating margin of 20%, Company B is likely more profitable than Company A.