Continuing Operations

What are 'Continuing Operations'

Continuing operations refer to a business term used to describe the segments of a company's business that it considers to be normal, and expects to operate in for the foreseeable future. We most often see continuing operations referenced in earnings reports as a subset of net earnings, as a way to show investors how the company is performing across its core business lines.

BREAKING DOWN 'Continuing Operations'

In today's financial markets, with so many mergers, acquisitions and business divestitures happening all the time, it is invaluable to break down net earnings into earnings from continuing operations versus profits from discontinued operations, asset sales or financing activities. This allows us to see what portion of current earnings the company can reasonably replicate in the future, and what are one-time occurrences and abnormal events.

RELATED TERMS
  1. Operating Profit

    The profit earned from a firm's normal core business operations. ...
  2. Operating Earnings

    Profit earned after subtracting from revenues those expenses ...
  3. Discontinued Operations

    A segment of a company's business that has been sold, disposed ...
  4. Operating Margin

    A ratio used to measure a company's pricing strategy and operating ...
  5. Operating Income

    The amount of profit realized from a business's operations after ...
  6. Income From Operations - IFO

    The profit realized from a business' own operations. Income from ...
Related Articles
  1. Markets

    Operating Profit

    Operating profit is the profit generated from the core business of a company before accounting for interest and taxes.
  2. Investing

    What is Operating Revenue?

    Operating revenue is income that’s derived from sources related to a company’s everyday business operations.
  3. Investing

    Core Earnings Strip Away "Creative" Accounting

    This metric is an attempt to counteract creative accounting, but it poses its own set of challenges.
  4. Markets

    IBM Stock: An Earnings Case Study

    Learn the main drivers behind IBM's earnings model and why analysts predict a decline in 2016 followed by a strong recovery in 2017.
  5. Investing

    Understanding Operating Activities

    Operating activities are the daily processes conducted by a company to generate income.
  6. Investing

    What are Operating Expenses?

    An operating expense is any expenditure made for the purpose of operating a business. These expenses are the day-to-day costs that help keep the business going. Operating expenses are reflected ...
  7. Investing

    The 5 Types Of Earnings Per Share

    Understanding the many varieties of earnings per share will help investors make informed decisions.
  8. Investing

    Operating Leverage Captures Relationships

    Find out how fixed and variable costs interact to shed new light on old companies.
  9. Markets

    What are Earnings?

    The amount of profit that a company produces during a specific period, which is usually defined as a quarter (three calendar months) or a year.
  10. Personal Finance

    Everything Investors Need To Know About Earnings

    We go over the concepts behind the excitement over the most important figure in the stock market.
RELATED FAQS
  1. What are the differences between operating profit and operating income?

    Learn how operating income, also known as operating profit, is determined. Also, see how investors use this number on the ... Read Answer >>
  2. What is the difference between operating income and operating profit?

    Find out why operating margin and operating income can be treated synonymously with EBIT, but how they all differ from operating ... Read Answer >>
  3. What is the difference between Operating Cash Flow and Net Operating Income (NOI)?

    Learn what operating cash flow and net operating income are, how the two metrics are calculated and the main difference between ... Read Answer >>
  4. Why does operating profit exclude interest revenues and expenses?

    Understand the purpose of examining a company's operating profit margin and why interest revenues and expenses are not included ... Read Answer >>
  5. What is a good operating margin for a business?

    Read about what it means to have a good operating margin and why that answer depends heavily on competitive and historical ... Read Answer >>
  6. What does operating margin measure?

    Learn about why investors look to a company's operating margin, or return on sales, as a signal of both efficiency and profitability. Read Answer >>
Hot Definitions
  1. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  2. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
  3. Brexit

    The Brexit, an abbreviation of "British exit" that mirrors the term Grexit, refers to the possibility of Britain's withdrawal ...
  4. Underweight

    1. A situation where a portfolio does not hold a sufficient amount of a particular security when compared to the security's ...
  5. Russell 3000 Index

    A market capitalization weighted equity index maintained by the Russell Investment Group that seeks to be a benchmark of ...
  6. Enterprise Value (EV)

    A measure of a company's value, often used as an alternative to straightforward market capitalization. Enterprise value is ...
Trading Center