The annual percentage change in a company's net income. The calculation is a given year's net income minus the prior year's net income, divided by the prior year's net income. The resulting figure is then multiplied by 100.
Benefit
If this figure is positive, the company’s net income is growing; if it’s negative, net income is generally declining. However, it’s best to look at the Net Income % Change for each of the past several years. Sometimes a one-time charge can depress earnings for a single year, even though the company’s earnings are generally rising; in other cases, earnings may have only started slipping in the most recent year. Annual Net Income % Change figures give a more long-term perspective than quarterly figures.
Origin
This information is found in the company’s annual income statements for the current and prior years.