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 Sep 22, 2026

$129.97T Total Market Cap

— Avg P/E Ratio

$129.77 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	$16.67	96.40%	212.62M	194.17M	2.26B
2	MAIN	Main Street Capital Corp	$56.28	87.11%	594.62M	517.99M	5.27B
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	$56.28	82.75%	519.14M	407.01M	5.27B
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	$36.11	74.30%	385.00M	286.04M	9.65B
9	WDC	Western Digital Corp	$448.17	72.95%	12.32B	8.99B	161.23B
10	TGTX	Tg Therapeutics Inc	$57.16	72.56%	591.27M	429.02M	8.81B
11	OR	Or Royalties Inc	$36.11	70.59%	355.20M	237.51M	9.65B
12	WDC	Western Digital Corp	$448.17	69.30%	9.68B	6.35B	161.23B
13	INVA	Innoviva Inc	$21.12	65.92%	345.95M	228.06M	1.51B
14	HTGC	Hercules Capital Inc	$17.37	63.80%	526.81M	336.12M	3.29B
15	WPM	Wheaton Precious Metals Corp	$147.66	63.58%	3.28B	2.09B	97.35B
16	OTF	Blue Owl Technology Finance	$10.64	62.89%	1.33B	836.63M	5.04B
17	INVA	Innoviva Inc	$21.12	62.62%	321.88M	190.97M	1.51B
18	TFPM	Triple Flag Precious Met	$32.76	61.74%	545.98M	337.11M	9.48B
19	FNV	Franco-Nevada Corp	$261.68	61.01%	2.56B	1.56B	72.04B
20	MTG	Mgic Investment Corp	$29.45	60.84%	1.06B	644.76M	6.10B
21	APP	Applovin Corp-Class A	$330.17	60.83%	5.69B	3.46B	109.28B
22	HTGC	Hercules Capital Inc	$17.37	60.61%	445.35M	255.73M	3.29B
23	WPM	Wheaton Precious Metals Corp	$147.66	60.40%	2.53B	1.45B	97.35B
24	TPL	Texas Pacific Land Corp	$366.80	60.31%	785.21M	473.55M	23.95B
25	OTF	Blue Owl Technology Finance	$10.64	59.75%	1.01B	569.22M	5.04B
26	TFPM	Triple Flag Precious Met	$32.76	58.65%	399.17M	221.82M	9.48B
27	UNIT	Uniti Group Inc	$9.45	58.39%	2.04B	1.19B	2.32B
28	FNV	Franco-Nevada Corp	$261.68	57.96%	2.29B	1.26B	72.04B
29	GFL	Gfl Environmental Inc-Sub Vt	$42.76	57.95%	10.83B	6.28B	26.37B
30	MTG	Mgic Investment Corp	$29.45	57.80%	1.05B	573.68M	6.10B
31	APP	Applovin Corp-Class A	$330.17	57.79%	4.55B	2.49B	109.28B
32	TPL	Texas Pacific Land Corp	$366.80	57.29%	739.72M	401.50M	23.95B
33	SNDK	Sandisk Corp	$1,766.64	56.46%	17.04B	9.62B	233.67B
34	NVDA	NVIDIA Corp	$227.38	55.60%	209.95B	116.74B	5.30T
35	AGO	Assured Guaranty Ltd	$71.07	55.58%	822.15M	456.95M	3.11B
36	UNIT	Uniti Group Inc	$9.45	55.47%	1.62B	851.77M	2.32B
37	BLX	Banco Latinoamericano Come-E	$53.83	55.22%	158.82M	211.26M	1.91B
38	GFL	Gfl Environmental Inc-Sub Vt	$42.76	55.05%	10.91B	5.69B	26.37B
39	NMIH	Nmi Holdings Inc	$42.52	55.05%	671.83M	369.87M	3.22B
40	PICS	Pics Nv	$9.28	54.81%	1.85B	1.01B	1.23B
41	ESNT	Essent Group Ltd	$66.47	54.72%	1.15B	629.76M	6.13B
42	ACT	Enact Holdings Inc	$48.05	54.56%	1.14B	620.29M	6.66B
43	GSL	Global Ship Lease Inc-Cl A	$45.84	54.34%	777.73M	422.59M	1.67B
44	SNDK	Sandisk Corp	$1,766.64	53.64%	11.41B	5.80B	233.67B
45	BAM	Brookfield Asset Mgmt-A	$46.22	53.30%	4.70B	2.50B	75.60B
46	NVDA	NVIDIA Corp	$227.38	53.06%	75.57B	37.98B	5.30T
47	NTNX	Nutanix Inc - A	$70.04	52.81%	2.60B	1.37B	18.57B
48	AGO	Assured Guaranty Ltd	$71.07	52.80%	741.55M	370.94M	3.11B
49	KRYS	Krystal Biotech Inc	$333.85	52.64%	384.57M	202.43M	9.97B
50	BLX	Banco Latinoamericano Come-E	$53.83	52.46%	148.82M	178.16M	1.91B
51	NMIH	Nmi Holdings Inc	$42.52	52.30%	607.88M	301.19M	3.22B
52	PICS	Pics Nv	$9.28	52.07%	1.41B	696.47M	1.23B
53	ESNT	Essent Group Ltd	$66.47	51.98%	1.07B	524.75M	6.13B
54	ACT	Enact Holdings Inc	$48.05	51.83%	1.09B	536.18M	6.66B
55	GSL	Global Ship Lease Inc-Cl A	$45.84	51.62%	734.47M	359.17M	1.67B
56	NTNX	Nutanix Inc - A	$70.04	50.17%	2.25B	1.07B	18.57B
57	V	Visa Inc	$369.95	50.14%	38.18B	19.15B	691.16B
58	PFBC	Preferred Bank/Los Angeles	$105.42	50.09%	232.34M	139.25M	1.42B
59	SFBS	Servisfirst Bancshares Inc	$41.92	49.88%	1.02B	560.85M	4.59B
60	VRSN	Verisign Inc	$308.18	49.84%	1.54B	767.59M	26.43B
61	AGI	Alamos Gold Inc-Class A	$35.21	48.97%	2.42B	1.18B	20.17B
62	IDCC	Interdigital Inc	$326.70	48.76%	624.79M	304.63M	8.34B
63	AER	Aercap Holdings Nv	$143.00	48.73%	6.82B	3.32B	22.09B
64	OTTR	Otter Tail Corp	$88.13	48.68%	572.29M	278.59M	3.72B
65	CSWC	Capital Southwest Corp	$23.37	48.68%	226.45M	110.24M	1.50B
66	RDN	Radian Group Inc	$34.32	48.62%	1.13B	551.49M	4.67B
67	WINA	Winmark Corp	$293.40	48.40%	90.48M	43.79M	1.11B
68	EWBC	East West Bancorp Inc	$127.77	48.12%	2.29B	1.32B	17.63B
69	V	Visa Inc	$369.95	47.63%	34.42B	15.54B	691.16B
70	PFBC	Preferred Bank/Los Angeles	$105.42	47.59%	212.96M	114.87M	1.42B
71	CLSK	Cleanspark Inc	$14.47	47.56%	604.84M	287.67M	3.43B
72	DAC	Danaos Corp	$161.19	47.45%	1.04B	494.13M	2.94B
73	SFBS	Servisfirst Bancshares Inc	$41.92	47.39%	909.48M	447.93M	4.59B
74	VRSN	Verisign Inc	$308.18	47.35%	1.46B	657.00M	26.43B
75	DBSDY	DBS Group Holdings Ltd	$239.85	47.28%	6.08B	3.46B	162.83B
76	QXO	Qxo Inc	$12.20	46.72%	178.01M	78.78M	11.69B
77	AGI	Alamos Gold Inc-Class A	$35.21	46.52%	1.86B	818.54M	20.17B
78	LGND	Ligand Pharmaceuticals	$290.07	46.42%	262.55M	121.88M	5.63B
79	IDCC	Interdigital Inc	$326.70	46.32%	511.58M	224.49M	8.34B
80	AER	Aercap Holdings Nv	$143.00	46.29%	6.53B	2.87B	22.09B
81	OTTR	Otter Tail Corp	$88.13	46.25%	566.51M	248.20M	3.72B
82	CSWC	Capital Southwest Corp	$23.37	46.25%	181.39M	79.47M	1.50B
83	RDN	Radian Group Inc	$34.32	46.19%	1.13B	495.30M	4.67B
84	TRIN	Trinity Capital Inc	$17.63	46.18%	397.05M	183.35M	1.67B
85	HASI	Ha Sustainable Infrastructur	$37.03	46.08%	378.60M	174.46M	4.80B
86	WABC	Westamerica Bancorporation	$60.70	46.06%	223.75M	102.82M	1.37B
87	WINA	Winmark Corp	$293.40	45.98%	88.82M	38.69M	1.11B
88	EWBC	East West Bancorp Inc	$127.77	45.71%	2.13B	1.11B	17.63B
89	MA	Mastercard Inc	$567.65	45.65%	31.82B	14.52B	496.89B
90	CATY	Cathay General Bancorp	$61.48	45.62%	703.72M	301.58M	4.14B
91	PB	Prosperity Bancshares Inc	$69.91	45.60%	1.51B	687.30M	8.41B
92	AFRM	Affirm Holdings Inc	$71.05	45.29%	4.08B	1.85B	23.79B
93	RGLD	Royal Gold Inc	$250.11	45.25%	1.26B	572.04M	21.30B
94	CLSK	Cleanspark Inc	$14.47	45.18%	336.12M	143.88M	3.43B
95	MCBS	Metrocity Bankshares Inc	$35.25	45.10%	160.02M	78.04M	1.03B
96	TSM	Taiwan Semiconductor Manufacturing	$443.14	45.10%	21.49T	9.69T	54.07T
97	DAC	Danaos Corp	$161.19	45.08%	1.02B	437.62M	2.94B
98	BYD	Boyd Gaming Corp	$72.58	45.05%	3.77B	1.70B	5.49B
99	LYFT	Lyft Inc-A	$15.27	45.03%	5.88B	2.65B	5.87B
100	DBSDY	DBS Group Holdings Ltd	$239.85	44.92%	6.04B	3.09B	162.83B

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.