TTM Operating Income

Category

Ratios

Units

Currency

Formula

TTM Operating Income = Sum of operating income over the four most recent quarters

Source

Calculated by GeminIQ from figures reported in SEC filings

TTM operating income is the profit a company earned from its core business over the trailing twelve months, the four most recent fiscal quarters, after deducting operating expenses from operating revenue. It shows how profitable the company's day-to-day operations were over the latest full year, before interest, taxes, and non-operating gains or losses.

Operating income sits between gross profit and pretax income. It reflects cost of revenue and operating costs such as selling, general, and administrative expenses and research and development, but not financing costs or investment income.

Companies usually tag the figure OperatingIncomeLoss in XBRL, the result of subtracting operating expenses from operating revenues. Regulation S-X Rule 5-03 does not list operating income as a required caption, so not every company presents one. Many banks, insurers, and some industrial companies go straight from revenues and expenses to pretax income. When the line is missing, a trailing operating figure has to be built from revenue less operating expenses, or EBIT can be used instead.

Income statements in a 10-Q show both the three-month and year-to-date results. The fourth quarter is derived as the 10-K annual figure minus the nine-month figure from the third-quarter 10-Q, and the trailing total is the sum of the latest four quarters. Companies decide which items count as operating: restructuring charges, impairments, and gains on asset sales are often included above the operating line, while some companies put them below it. Those choices affect comparability across firms.

TTM operating income divided by TTM sales gives operating margin, a core measure of pricing power and cost control. Because it excludes interest and investment income, operating income is a cleaner measure of the business itself than EBIT built up from net income. Comparing the change in TTM operating income with the change in TTM sales gives incremental operating margin, which shows how much of each additional dollar of revenue reaches operating profit.