Revenue Management Glossary

Profit

Definition

Profit is the financial gain a hotel makes after subtracting all expenses from total revenue. It is a key indicator of a hotel’s financial health and reflects the success of revenue management, operational efficiency, and cost control.

How to use it

Revenue managers monitor profit—not just revenue—to ensure that pricing strategies cover both fixed and variable costs and deliver sustainable margins.

Formula

Profit = Revenue – Expenses

Related Terms

Revenue, Expenses, Gross Profit, Net Profit, Profit Margin, Cost Control
“Profit is the bottom line—the result of every strategic decision in a hotel, from pricing to operations.”

Hannah Lee

Hannah Lee
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