Top Line
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Definition of 'Top Line'A reference to the gross sales or revenues of a company, or an allusion to a course of action that increases or reduces revenues. The "top" reference relates to the fact that on a company's income statement, the first line at the top of the page is generally reserved for gross sales or revenue. A company that increases its revenues is said to be "growing its top line", or "generating top-line growth".This contrasts with net income (or net earnings per share), which is usually the bottom line of the company's income statement. |
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Investopedia explains 'Top Line'While there are number of different business models that have proved to be successful, every company is faced with the two simple goals of:1. Growing revenues, or generating top-line growth 2. Growing net income, or generating bottom-line growth. Part of the reason why the term is used so often is that it clarifies minor nuances between the sources of revenue, whether it's from selling a product, collecting interest or servicing an account. "Top-line" is broad enough to include all of the company revenues into one category prior to calculating other income statement metrics such as operating profit and net income. |
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