Highest Profit Margins

Q: What is a profit margin?

Profit margin is the percentage of revenue remaining after all expenses, taxes, and costs are deducted. A company with $100 million in revenue and $30 million in net income has a 30% profit margin. There are several types: gross margin (revenue minus cost of goods sold), operating margin (after operating expenses), and net margin (after everything including taxes and interest). This list uses net profit margin, the most comprehensive measure.

Q: What is a good profit margin?

Average profit margins vary significantly by industry. Software companies average 20-30%, pharmaceutical companies 15-25%, while retail and restaurants typically operate at 3-8%. A margin above 25% — the threshold for this list — places a company among the most profitable in any sector. What matters more than the absolute level is the trend: expanding margins suggest improving business quality, while declining margins may signal competitive pressure.

Q: What sectors have the highest profit margins?

Software, semiconductors, and pharmaceuticals consistently have the highest profit margins. Software companies benefit from near-zero marginal costs — selling one more license costs almost nothing. Semiconductor designers like Nvidia and Broadcom have margins above 50%. Pharmaceutical companies enjoy patent-protected pricing power. Financial services, especially asset management, also produces high margins. Capital-light business models generally produce higher margins than asset-heavy industries.

Q: Why do high-margin companies make good investments?

High margins indicate pricing power and competitive advantages that protect against competition and economic downturns. Companies with fat margins have a buffer — even if revenue dips, they remain profitable. They generate more free cash flow per dollar of revenue, funding dividends, buybacks, and R&D without debt. High-margin companies also tend to have higher returns on equity, meaning they create more value for shareholders per dollar invested in the business.

Q: What is an economic moat?

An economic moat is a durable competitive advantage that protects a company's profits from competitors, similar to a castle's moat. Types include brand power (Apple, Coca-Cola), network effects (Visa, Meta), switching costs (Microsoft, Adobe), cost advantages (Walmart), and intellectual property (pharmaceutical patents). Companies with wide moats tend to maintain high profit margins for years or decades. The concept was popularized by Warren Buffett as central to his investment philosophy.

Q: Can profit margins be misleading?

Yes. One-time events can temporarily inflate or depress margins — asset sales, tax benefits, or restructuring charges can distort the picture. Some companies show high net margins but low operating margins because of investment income or tax advantages rather than strong business operations. Cyclical companies may show peak margins at the top of a cycle that are unsustainable. Always look at multi-year margin trends rather than a single period.

Q: What is the difference between gross margin and net margin?

Gross margin measures profitability after subtracting only the direct costs of producing goods or services (cost of goods sold). Net margin subtracts everything — operating expenses, interest, taxes, and other costs. Gross margin shows the core profitability of the product itself, while net margin shows overall company profitability. A company with high gross margins but low net margins may be overspending on sales, marketing, or R&D, which could be either a problem or a growth investment.

Cash machines: companies turning over 25% of revenue into net profit. A sign of pricing power, brand moats, and operational efficiency.

200 stocks Updated Nov 6, 2026

$130.54T Total Market Cap

— Avg P/E Ratio

$118.66 Avg Share Price

+0.00% Avg Daily Change

Profit margin measures the percentage of revenue that a company converts into net profit after all expenses. Companies with margins above 25% are exceptional — they possess the pricing power, operational efficiency, and competitive advantages that allow them to keep a quarter or more of every dollar earned.

High profit margins are one of Warren Buffett's key criteria for identifying durable competitive advantages, or "economic moats." Companies with consistently high margins typically benefit from strong brands, network effects, intellectual property, or scale advantages that competitors cannot easily replicate. Technology and pharmaceutical companies frequently lead in margins due to low marginal costs and patent protection.

This list screens for companies with net profit margins above 25% and market caps over $1 billion. It displays margin percentages, revenue, net income, and market cap. Financial data is sourced from the most recent annual reports and updated weekly.

#	Symbol	Name	Price	Margin	Revenue	Net Income	Market Cap
1	AUPH	Aurinia Pharmaceuticals Inc	$16.21	96.40%	213.80M	195.24M	2.22B
2	MAIN	Main Street Capital Corp	$56.86	87.11%	599.53M	522.27M	5.23B
3	LBRDK	Liberty Broadband-C	$36.02	85.53%	1.02B	869.58M	5.15B
4	LBRDA	Liberty Broadband-A	$35.99	85.53%	1.02B	870.30M	5.15B
5	MAIN	Main Street Capital Corp	$56.86	82.75%	523.42M	410.37M	5.23B
6	LBRDK	Liberty Broadband-C	$36.02	81.25%	1.01B	775.33M	5.15B
7	LBRDA	Liberty Broadband-A	$35.99	81.25%	1.01B	775.98M	5.15B
8	OR	Or Royalties Inc	$35.21	74.30%	399.66M	296.93M	8.68B
9	WDC	Western Digital Corp	$267.63	72.95%	14.34B	10.46B	155.70B
10	TGTX	Tg Therapeutics Inc	$57.98	72.56%	628.94M	456.36M	8.89B
11	OR	Or Royalties Inc	$35.21	70.59%	368.72M	246.56M	8.68B
12	WDC	Western Digital Corp	$267.63	69.30%	11.26B	7.40B	155.70B
13	INVA	Innoviva Inc	$19.24	65.92%	349.78M	230.59M	1.54B
14	MU	Micron Technology Inc	$656.39	63.80%	131.68B	84.01B	999.81B
15	HTGC	Hercules Capital Inc	$16.32	63.80%	522.50M	333.37M	3.10B
16	WPM	Wheaton Precious Metals Corp	$132.46	63.58%	3.51B	2.23B	80.34B
17	OTF	Blue Owl Technology Finance	$9.55	62.89%	1.28B	806.18M	4.36B
18	INVA	Innoviva Inc	$19.24	62.62%	325.44M	193.09M	1.54B
19	TFPM	Triple Flag Precious Met	$30.79	61.74%	569.83M	351.84M	8.40B
20	FNV	Franco-Nevada Corp	$250.69	61.01%	2.62B	1.60B	62.41B
21	MTG	Mgic Investment Corp	$29.40	60.84%	1.06B	644.44M	5.83B
22	APP	Applovin Corp-Class A	$356.10	60.83%	5.36B	3.26B	76.47B
23	HTGC	Hercules Capital Inc	$16.32	60.61%	441.71M	253.64M	3.10B
24	WPM	Wheaton Precious Metals Corp	$132.46	60.40%	2.71B	1.55B	80.34B
25	TPL	Texas Pacific Land Corp	$272.18	60.31%	794.59M	479.20M	22.79B
26	OTF	Blue Owl Technology Finance	$9.55	59.75%	969.09M	548.50M	4.36B
27	TFPM	Triple Flag Precious Met	$30.79	58.65%	416.60M	231.51M	8.40B
28	UNIT	Uniti Group Inc	$5.06	58.39%	2.05B	1.20B	1.24B
29	FNV	Franco-Nevada Corp	$250.69	57.96%	2.35B	1.29B	62.41B
30	GFL	Gfl Environmental Inc-Sub Vt	$46.12	57.95%	10.60B	6.15B	27.44B
31	MTG	Mgic Investment Corp	$29.40	57.80%	1.05B	573.40M	5.83B
32	APP	Applovin Corp-Class A	$356.10	57.79%	4.30B	2.35B	76.47B
33	TPL	Texas Pacific Land Corp	$272.18	57.29%	748.55M	406.30M	22.79B
34	SNDK	Sandisk Corp	$806.43	56.46%	18.88B	10.66B	166.34B
35	NVDA	NVIDIA Corp	$181.60	55.60%	214.35B	119.18B	4.98T
36	AGO	Assured Guaranty Ltd	$71.76	55.58%	834.25M	463.68M	3.11B
37	UNIT	Uniti Group Inc	$5.06	55.47%	1.63B	857.66M	1.24B
38	BLX	Banco Latinoamericano Come-E	$51.27	55.22%	160.34M	213.29M	1.84B
39	GFL	Gfl Environmental Inc-Sub Vt	$46.12	55.05%	10.68B	5.57B	27.44B
40	NMIH	Nmi Holdings Inc	$43.92	55.05%	689.38M	379.53M	3.25B
41	ESNT	Essent Group Ltd	$68.81	54.72%	1.14B	625.34M	6.08B
42	ACT	Enact Holdings Inc	$47.84	54.56%	1.14B	620.81M	6.49B
43	GSL	Global Ship Lease Inc-Cl A	$40.13	54.34%	761.66M	413.85M	1.51B
44	SNDK	Sandisk Corp	$806.43	53.64%	12.65B	6.43B	166.34B
45	BAM	Brookfield Asset Mgmt-A	$52.46	53.30%	4.69B	2.50B	79.06B
46	NVDA	NVIDIA Corp	$181.60	53.06%	75.57B	37.98B	4.98T
47	NTNX	Nutanix Inc - A	$58.55	52.81%	2.62B	1.38B	18.04B
48	AGO	Assured Guaranty Ltd	$71.76	52.80%	752.46M	376.39M	3.11B
49	KRYS	Krystal Biotech Inc	$300.25	52.64%	381.27M	200.69M	9.75B
50	BLX	Banco Latinoamericano Come-E	$51.27	52.46%	150.25M	179.87M	1.84B
51	NMIH	Nmi Holdings Inc	$43.92	52.30%	623.76M	309.06M	3.25B
52	ESNT	Essent Group Ltd	$68.81	51.98%	1.06B	521.07M	6.08B
53	ACT	Enact Holdings Inc	$47.84	51.83%	1.09B	536.62M	6.49B
54	GSL	Global Ship Lease Inc-Cl A	$40.13	51.62%	719.29M	351.75M	1.51B
55	NTNX	Nutanix Inc - A	$58.55	50.17%	2.27B	1.08B	18.04B
56	V	Visa Inc	$422.59	50.14%	37.59B	18.85B	764.09B
57	PFBC	Preferred Bank/Los Angeles	$103.49	50.09%	206.10M	123.52M	1.27B
58	SFBS	Servisfirst Bancshares Inc	$41.32	49.88%	1.01B	553.13M	4.43B
59	VRSN	Verisign Inc	$312.06	49.84%	1.61B	804.26M	28.07B
60	AGI	Alamos Gold Inc-Class A	$31.08	48.97%	2.63B	1.29B	16.85B
61	IDCC	Interdigital Inc	$286.53	48.76%	669.80M	326.58M	8.63B
62	AER	Aercap Holdings Nv	$166.17	48.73%	6.76B	3.29B	24.52B
63	OTTR	Otter Tail Corp	$79.39	48.68%	556.60M	270.95M	3.79B
64	CSWC	Capital Southwest Corp	$23.27	48.68%	224.43M	109.26M	1.48B
65	RDN	Radian Group Inc	$37.27	48.62%	1.18B	572.75M	4.71B
66	WINA	Winmark Corp	$268.59	48.40%	86.81M	42.02M	1.07B
67	EWBC	East West Bancorp Inc	$129.04	48.12%	2.29B	1.33B	18.22B
68	V	Visa Inc	$422.59	47.63%	33.89B	15.29B	764.09B
69	PFBC	Preferred Bank/Los Angeles	$103.49	47.59%	188.91M	101.90M	1.27B
70	CLSK	Cleanspark Inc	$5.78	47.56%	543.55M	258.52M	1.93B
71	DAC	Danaos Corp	$157.02	47.45%	1.03B	488.73M	2.87B
72	SFBS	Servisfirst Bancshares Inc	$41.32	47.39%	896.96M	441.76M	4.43B
73	VRSN	Verisign Inc	$312.06	47.35%	1.53B	688.39M	28.07B
74	DBSDY	DBS Group Holdings Ltd	$222.72	47.28%	6.08B	3.46B	162.83B
75	QXO	Qxo Inc	$11.64	46.72%	178.01M	78.78M	11.31B
76	AGI	Alamos Gold Inc-Class A	$31.08	46.52%	2.02B	890.06M	16.85B
77	LGND	Ligand Pharmaceuticals	$302.29	46.42%	262.16M	121.70M	6.33B
78	IDCC	Interdigital Inc	$286.53	46.32%	548.43M	240.66M	8.63B
79	AER	Aercap Holdings Nv	$166.17	46.29%	6.48B	2.84B	24.52B
80	OTTR	Otter Tail Corp	$79.39	46.25%	550.98M	241.39M	3.79B
81	CSWC	Capital Southwest Corp	$23.27	46.25%	179.77M	78.77M	1.48B
82	RDN	Radian Group Inc	$37.27	46.19%	1.18B	514.40M	4.71B
83	TRIN	Trinity Capital Inc	$17.74	46.18%	395.29M	182.54M	1.61B
84	HASI	Ha Sustainable Infrastructur	$39.68	46.08%	380.60M	175.38M	4.78B
85	WABC	Westamerica Bancorporation	$60.73	46.06%	224.49M	103.16M	1.40B
86	WINA	Winmark Corp	$268.59	45.98%	85.22M	37.12M	1.07B
87	EWBC	East West Bancorp Inc	$129.04	45.71%	2.14B	1.11B	18.22B
88	MA	Mastercard Inc	$655.92	45.65%	31.75B	14.50B	559.77B
89	CATY	Cathay General Bancorp	$64.18	45.62%	707.13M	303.04M	4.32B
90	PB	Prosperity Bancshares Inc	$71.97	45.60%	1.51B	688.02M	8.66B
91	AFRM	Affirm Holdings Inc	$69.66	45.29%	4.14B	1.88B	24.91B
92	RGLD	Royal Gold Inc	$261.28	45.25%	1.25B	564.72M	19.27B
93	CLSK	Cleanspark Inc	$5.78	45.18%	302.05M	129.30M	1.93B
94	MCBS	Metrocity Bankshares Inc	$36.08	45.10%	154.96M	75.57M	1.03B
95	TSM	Taiwan Semiconductor Manufacturing	$353.10	45.10%	21.49T	9.69T	54.07T
96	DAC	Danaos Corp	$157.02	45.08%	1.01B	432.84M	2.87B
97	BYD	Boyd Gaming Corp	$76.94	45.05%	3.52B	1.59B	5.12B
98	LYFT	Lyft Inc-A	$17.91	45.03%	5.69B	2.56B	6.08B
99	DBSDY	DBS Group Holdings Ltd	$222.72	44.92%	6.04B	3.09B	162.83B
100	OZK	Bank Ozk	$50.98	44.89%	1.14B	690.32M	5.53B

Frequently Asked Questions

What is a profit margin?

Profit margin is the percentage of revenue remaining after all expenses, taxes, and costs are deducted. A company with $100 million in revenue and $30 million in net income has a 30% profit margin. There are several types: gross margin (revenue minus cost of goods sold), operating margin (after operating expenses), and net margin (after everything including taxes and interest). This list uses net profit margin, the most comprehensive measure.

What is a good profit margin?

Average profit margins vary significantly by industry. Software companies average 20-30%, pharmaceutical companies 15-25%, while retail and restaurants typically operate at 3-8%. A margin above 25% — the threshold for this list — places a company among the most profitable in any sector. What matters more than the absolute level is the trend: expanding margins suggest improving business quality, while declining margins may signal competitive pressure.

What sectors have the highest profit margins?

Software, semiconductors, and pharmaceuticals consistently have the highest profit margins. Software companies benefit from near-zero marginal costs — selling one more license costs almost nothing. Semiconductor designers like Nvidia and Broadcom have margins above 50%. Pharmaceutical companies enjoy patent-protected pricing power. Financial services, especially asset management, also produces high margins. Capital-light business models generally produce higher margins than asset-heavy industries.

Why do high-margin companies make good investments?

High margins indicate pricing power and competitive advantages that protect against competition and economic downturns. Companies with fat margins have a buffer — even if revenue dips, they remain profitable. They generate more free cash flow per dollar of revenue, funding dividends, buybacks, and R&D without debt. High-margin companies also tend to have higher returns on equity, meaning they create more value for shareholders per dollar invested in the business.

What is an economic moat?

An economic moat is a durable competitive advantage that protects a company's profits from competitors, similar to a castle's moat. Types include brand power (Apple, Coca-Cola), network effects (Visa, Meta), switching costs (Microsoft, Adobe), cost advantages (Walmart), and intellectual property (pharmaceutical patents). Companies with wide moats tend to maintain high profit margins for years or decades. The concept was popularized by Warren Buffett as central to his investment philosophy.

Can profit margins be misleading?

Yes. One-time events can temporarily inflate or depress margins — asset sales, tax benefits, or restructuring charges can distort the picture. Some companies show high net margins but low operating margins because of investment income or tax advantages rather than strong business operations. Cyclical companies may show peak margins at the top of a cycle that are unsustainable. Always look at multi-year margin trends rather than a single period.

What is the difference between gross margin and net margin?

Gross margin measures profitability after subtracting only the direct costs of producing goods or services (cost of goods sold). Net margin subtracts everything — operating expenses, interest, taxes, and other costs. Gross margin shows the core profitability of the product itself, while net margin shows overall company profitability. A company with high gross margins but low net margins may be overspending on sales, marketing, or R&D, which could be either a problem or a growth investment.