is everything a company takes in with its products in a year. Subtract all costs, including interest and taxes, and the profit remains. The tells you what percentage of revenue is left. Divide the profit by the number of shares and you get the .
Do the math
Model company: revenue €500m, costs €440m, profit €60m. The margin is 60 ÷ 500 = 12%. With 20m shares, that is 60 ÷ 20 = €3.00 earnings per share.
Revenue is not profit
A company can have high revenue and still make a loss if its costs are higher. Conversely, a small company with a high margin can earn a lot. Margins differ greatly by sector: a grocery retailer often works with a few percent, a software company often with much more.
Where to find the figures
Companies report revenue and profit in quarterly and annual reports. For US stocks, the chart page shows a key figures bar with revenue, profit, margin and earnings per share from the filings with the US Securities and Exchange Commission (SEC) – as information, not as a trading cue.