Discontinued Operations

DEFINITION of 'Discontinued Operations'

A segment of a company's business that has been sold, disposed of or abandoned. Discontinued operations can range from a certain product line to an entire line of business. When operations are discontinued, this is reported on the company's income statement as separate from income from continued operations.
 

BREAKING DOWN 'Discontinued Operations'

Because income from discontinued operations is listed separately on the income statement, investors are less likely to be misled as to the source of a company's profit. This is especially useful when companies merge, since parsing out which assets are being divested or folded up gives a clearer picture of how a company will make money in the future.
 

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