Income (Loss) from Continuing Operations

Category

Income Statement

Units

Currency

US-GAAP elements

IncomeLossFromContinuingOperationsIncludingPortionAttributableToNoncontrollingInterestIncomeLossFromContinuingOperations

Reference

Regulation S-X Rule 5-03.13 (Income or loss from continuing operations); ASC 205-20

Source

Reported in SEC EDGAR filings (US-GAAP XBRL taxonomy)

Income (loss) from continuing operations is a company's after-tax profit or loss from the businesses it still owns and intends to keep running. It includes all revenue, expenses, non-operating items, and income taxes for those businesses, and it excludes the results of any operation reported as discontinued.

On the income statement it is the subtotal just above discontinued operations. For most companies in most years, with nothing discontinued, it equals net income.

Regulation S-X Rule 5-03.13 lists income or loss from continuing operations as its own caption, after income tax expense and equity-method earnings and before discontinued operations. Companies tag it in XBRL as IncomeLossFromContinuingOperationsIncludingPortionAttributableToNoncontrollingInterest for the consolidated amount, and as IncomeLossFromContinuingOperations for the portion attributable to the parent's shareholders.

Everything that is not discontinued stays here, including items that are unusual or unlikely to recur. Restructuring charges, asset impairments, litigation settlements, and gains on selling individual assets are all part of continuing operations. Since extraordinary items were eliminated from US GAAP, rare events such as major casualty losses are reported here as well. The label means the business is ongoing, not that every item in it will repeat.

This subtotal has a specific role in earnings per share. ASC 260 uses income from continuing operations as the control number for deciding whether potential shares are dilutive: if it is a loss, diluted shares equal basic shares even when net income is positive because of a gain on a discontinued unit. Companies must report EPS from continuing operations separately. Analysts favor this line over net income for trend analysis and valuation multiples, since it strips out results from businesses that will not contribute to future earnings.