The operating profit margin is also known as the operating margin for short. It helps to answer the question to what extent are we operating our business efficiently? It provides insights into a company’s efficiency and pricing strategy.

Interest and taxes are two expenses that are not “operating”. We want to look at the earnings before the deduction of interest expenses and taxes. This is called EBIT, or earnings before interest and taxes.

For more information, The Main KPI Types has a list of some KPIs and their types.