The Income Statement (P&L) shows Revenue minus Costs over a period (monthly/quarterly/annually). Key lines: Revenue, COGS (Cost of Goods Sold), Gross Profit, OPEX (Operating Expenses), EBITDA, Net Income.
Gross Margin
Gross Margin = (Revenue - COGS) / Revenue × 100%
SaaS target: 70-80%. Hardware: 30-50%. Hybrid: 50-65%.
EBITDA Margin
EBITDA = Revenue - COGS - OPEX (before interest, tax, depreciation, amortization)
Key Takeaways
- P&L: Revenue → Gross Profit → EBITDA → Net Income.
- Gross margin is your product's fundamental economics.
- OPEX breakdown: R&D + S&M + G&A.
- Target positive EBITDA by Year 3-4 for most B2B startups.