The basic revenue meaning is simple: revenue is the total money a business, group or government receives from its normal activity, counted before any costs are taken away. A shop's revenue is what customers paid at the till; a city's revenue is mostly the taxes and fees it collects.
People mix revenue up with profit all the time, even though one number can be huge while the other is tiny. Coming up: the definition of revenue, a small worked example with numbers, the words it gets confused with, and the way it is used in company reports, news and Indian government offices.
Entry at a glance
Meaning
Income received before expenses are subtractedPart of speech
Noun (often plural: revenues)Pronunciation
REV-uh-noo (US), REV-uh-nyoo (UK and India)Also called
Sales, turnover, the top lineNot the same as
Profit, which is what remains after costsOrigin
Old French revenue, something that comes back, from revenir, to returnRegister
Neutral; standard in business, accounting and government
Revenue meaning, sense by sense
To define revenue you need two or three senses, depending on who is talking.
- Business revenue. All the money a company earns from selling goods or services in a period, such as a quarter or a year. It sits at the top of the income statement, which is why people call it the top line.
- Government revenue. Money a state collects, mainly from taxes, duties, fees and fines. A finance ministry talks about tax revenue and non tax revenue.
- Revenues (plural). The separate streams that money comes from: "The club's revenues come from tickets, sponsorship and food stalls."
In every sense the idea is the same: money flowing in, with nothing yet taken out.
A worked example with a small bakery
Imagine a bakery that sells 2,000 loaves in a month at 3 dollars each. Its revenue for the month is 6,000 dollars. That number does not care about flour, rent or wages.
| Line | Amount |
|---|---|
| Revenue (2,000 loaves x 3 dollars) | 6,000 |
| Flour, butter, packaging | 2,100 |
| Rent, power, wages | 2,600 |
| Profit | 1,300 |
If the owner brags about 6,000 dollars, she is quoting revenue. What she actually keeps is closer to 1,300. A business can grow revenue every year and still lose money if costs grow faster.
Revenue vs profit, income and turnover
| Word | What it measures |
|---|---|
| Revenue | Everything earned from sales, before costs |
| Profit (net income) | What is left after all costs, interest and tax |
| Gross profit | Revenue minus the direct cost of the goods sold |
| Turnover | Common British and Indian word for revenue; in HR it also means staff leaving |
| Cash flow | Money that actually moved in and out of the bank in the period |
One more subtle point: revenue is usually counted when it is earned, not when the cash lands. If you deliver a website in March and the client pays in May, the revenue normally belongs to March under accrual accounting.
Using the word in sentences
- Our revenue rose eight percent this quarter, but higher shipping costs ate most of the gain.
- The new toll road is expected to bring the state a steady stream of revenue.
- Subscriptions now make up half of the app's revenues.
- The startup has plenty of users and almost no revenue yet.
- Before you quote a price, ask whether the client means revenue or profit when they say "we made a million."
Common pairings: generate revenue, boost revenue, lost revenue, annual revenue, revenue stream, revenue growth, tax revenue. People also say "revenue-generating" for an activity that brings money in.
From French: money that returns
The word was borrowed from Old French, where revenue meant something that has come back. It is the past participle of revenir, to return, from Latin revenire. The first English use, in the late Middle Ages, was about income returning to an owner from land or property. The sense of a state's income from taxes followed, and the modern business sense grew from both.
Government offices, tax agencies and business headlines
In India the word is part of everyday government life. A district has a revenue department that keeps land records, and older documents talk about land revenue paid by farmers. The national tax officers belong to the Indian Revenue Service. In the US, the federal tax agency also carries the word in its name, and "internal revenue" means taxes collected inside the country.
In business news you will hear phrases like "revenue beat expectations" or "revenue guidance was cut," which compare a company's sales with what analysts predicted. Neighbouring money words live in our business and finance terms section, including budget and inflation.
Mix-ups to watch for
Other slips: writing "revenues" when you mean one total figure (the singular is usually better), or using revenue for a person's salary. A person has income or earnings; a business or government has revenue. Also, avenue is a road, not money, even though the two words rhyme.
Frequently asked questions
What is the definition of revenue in simple words?
Revenue is the money that comes in from selling things or providing a service, counted before you pay any bills. For a government, it is mostly taxes. It is a measure of how much was earned, not how much was kept.
Is revenue the same as profit?
No. Profit is what remains after all the costs are subtracted from revenue. A company with huge revenue can still make a loss, and a small one with modest revenue can be very profitable.
Is revenue the same as sales?
For most businesses the two are close, and people often use them as equals. Revenue can also include other operating income such as fees, licences or interest, so accountants keep the words apart when the detail matters.
What is the meaning of revenue in government?
It means the money a government collects to pay for its work, mainly income tax, goods and services tax, customs duties and fees. In Indian districts the revenue department also handles land records and related matters.
How do you pronounce revenue?
Americans usually say REV-uh-noo. In Britain and India you often hear REV-uh-nyoo, with a light y sound. The stress stays on the first part in both.
What is recurring revenue?
It is money a business can expect to receive again and again, such as monthly subscriptions or service contracts. Investors like it because it is more predictable than one-off sales.