Calculate your company's net operating profit after tax (NOPAT) with dynamic inputs.
NOPAT stands for Net Operating Profit After Tax. It is a financial metric that measures a company's profitability from its core operations after accounting for taxes but excluding the impact of debt and non-operating expenses. NOPAT provides an accurate picture of a company's operational efficiency.
The formula to calculate NOPAT is:
NOPAT = Operating Income × (1 - Tax Rate)
Here’s how the formula works:
Let’s calculate NOPAT using the following example:
Operating Income: $500,000
Tax Rate: 25% (0.25)
Using the formula: NOPAT = $500,000 × (1 - 0.25) = $500,000 × 0.75 = $375,000
In this example, the company’s NOPAT is $375,000.