Reading a P&L Statement

Summary

A basic read of a profit-and-loss statement — revenue, cost of goods sold, operating expenses, margin — enough to understand how your analysis connects to a company's actual financial health.

• 1Find a simplified public P&L example and identify each major line item.
• 2Learn the difference between gross margin and net margin.
• 3Practice connecting one of your analysis findings to its likely P&L impact.