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hey fools so what is net margin well net margin is the companyamp;#39;s net income divided by their revenue or sales now itamp;#39;s expressed as a percentage of revenue and if the amount of profit that a company takes in for every one dollar in sales they earn after deducting all their expenses now for example if a company earns one-and-a-half million dollars in net income on sales of 25 million dollars then their net margin is going to be that 1.5 million / 25 million so about six percent so about six percent of all the dollars that they took in at the top line of their income statement actually end up being kept now the tricky thing with net margin is that itamp;#39;s based on a companyamp;#39;s net income which as we know is a highly manipulated number so you have to take it with a grain of salt they can also vary wildly by industry so if you compare a software company to a grocer youamp;#39;ll see their margins are much different for instance grocery stores have notoriously s