| Soundwave said: Can someone explain to me the difference between operating loss/profit and net income? Which is more important? |
Operating income/loss are the amount of money made or lost by the business itself, in this case making and selling games, consoles as well as licensing fees. Basically all that has a direct connection to their business.
Net income takes into account other factors like foreign exchanges ratios, which in this case made each dollar to turn from 80 yen to 90 yen, hence 10 yen profit from every dollar they made. Other expenses such as interest payment from loans, buying or selling of assets such as buildings, vehicles, etc
Net income is financially, the most important one, because it decides if you are on red or black ink. However, Operating income is the most important when looking at core business, because it tells you if the company is being profitable doing what it does. If at the end of the year the company posts an operating loss but a positive net income, this will tell you that the company is depending on outside factors that are many times volatile, most importantly foreign exchange rates.
Proud poster of the 10000th reply at the Official Smash Bros Update Thread.
tag - "I wouldn't trust gamespot, even if it was a live comparison."
Bets with Conegamer:
Pandora's Tower will have an opening week of less than 37k in Japan. (Won!)
Pandora's Tower will sell less than 100k lifetime in Japan.
Stakes: 1 week of avatar control for each one.
