Browse Definitions :
Definition

top line

Contributor(s): Corinne Bernstein

Top line is a number that represents a company’s gross revenue or sales from products or services; this figure is so-named because it appears at the top of an income statement. The United States Securities and Exchange Commission (SEC) compares an income statement to a staircase with total revenue during a specific accounting period at the top, the steps below that show deductions for various costs or other operating expenses associated with earning the revenue, and the final step as the bottom line, or net income, after all the deductions are made.

Top-line growth, which refers to an increase in gross revenue or sales, shows how effective a company is at generating sales. However, the top line does not take into account operating efficiencies and costs that affect a company’s bottom line, or net profits, which appears on the bottom line of an income statement. Yet, it is possible for a company to experience top-line and bottom-line growth simultaneously if it keeps its operating costs in check. A company may report top-line growth but not bottom-line increases, or vice versa, in a given period, however the top and bottom lines -- as well as the numbers in between -- are crucial in determining a company’s financial health.

According to the American Management Association (AMA), revenue growth that is based on "customer benefit" is more likely to improve top line growth. The association defines customer benefit as the advantage customers gain from their experience of selecting and using a particular product or service. This is because when a product offers customers value, they are willing to pay more and play a bigger role in making the product profitable. They are also more willing to promote the product through word of mouth and social media marketing channels, which can help lower advertising costs. 

This was last updated in November 2017

Continue Reading About top line

Join the conversation

1 comment

Send me notifications when other members comment.

Please create a username to comment.

How are you structuring your sales team to optimize growth?
Cancel

-ADS BY GOOGLE

File Extensions and File Formats

SearchCompliance

  • PCI DSS (Payment Card Industry Data Security Standard)

    The Payment Card Industry Data Security Standard (PCI DSS) is a widely accepted set of policies and procedures intended to ...

  • risk management

    Risk management is the process of identifying, assessing and controlling threats to an organization's capital and earnings.

  • compliance framework

    A compliance framework is a structured set of guidelines that details an organization's processes for maintaining accordance with...

SearchSecurity

  • DNS over HTTPS (DoH)

    DNS over HTTPS (DoH) is a relatively new protocol that encrypts domain name system traffic by passing DNS queries through a ...

  • integrated risk management (IRM)

    Integrated risk management (IRM) is an approach to risk management that uses a set of practices and processes to improve an ...

  • MITRE ATT&CK framework

    The MITRE ATT&CK (pronounced 'miter attack') framework is a free, globally accessible service that provides comprehensive and ...

SearchHealthIT

  • telemedicine (telehealth)

    Telemedicine is the remote delivery of healthcare services, such as health assessments or consultations, over the ...

  • Project Nightingale

    Project Nightingale is a controversial partnership between Google and Ascension, the second largest health system in the United ...

  • medical practice management (MPM) software

    Medical practice management (MPM) software is a collection of computerized services used by healthcare professionals and ...

SearchDisasterRecovery

SearchStorage

  • M.2 SSD

    An M.2 SSD is a solid-state drive (SSD) that conforms to a computer industry specification and is used in internally mounted ...

  • kilobyte (KB or Kbyte)

    A kilobyte (KB or Kbyte) is a unit of measurement for computer memory or data storage used by mathematics and computer science ...

  • virtual memory

    Virtual memory is a memory management capability of an operating system (OS) that uses hardware and software to allow a computer ...

Close