BY SEAN ROSS Updated Aug 10, 2018

Revenue is the total income earned from the sale of goods and services, while retained earnings is the
amount of net income retained by a company. Both revenue and retained earnings are important in
evaluating a company's financial health, but highlight different aspects of the financial picture.

Revenue

Revenue sits at the top of the income statement and is often referred to as the top-line number when
describing a company's financial performance. Since revenue is the total income earned by a company,
it is the income generated before operating expenses, and overhead costs are deducted. In some
industries, revenue is called gross sales since the gross figure is before any deductions. However, net
sales can be used in place of revenue since net sales refers to revenue minus any exchanges or returns by
customers. For example, net sales is used by the retail industry.