{
  "id": "nopat",
  "version": "77509ac389d1",
  "status": "published",
  "name": "NOPAT Calculator",
  "question": "What is my NOPAT?",
  "summary": "Computes NOPAT (net operating profit after taxes): operating income (EBIT) times one minus the tax rate, from a typed rate or the effective rate.",
  "category": "finance",
  "subcategory": "business",
  "url": "https://www.acalculator.org/finance/nopat-calculator",
  "markdown": "https://www.acalculator.org/finance/nopat-calculator.md",
  "kind": "function",
  "method": "Tax rate = the rate typed, or income tax expense ÷ income before taxes. NOPAT = EBIT × (1 − tax rate). Taxes on operating income = EBIT × tax rate.",
  "assumptions": [
    "The tax rate applies to all of operating income; an operating loss is taxed at the same rate (it saves tax).",
    "The effective rate comes from the same income statement as EBIT.",
    "Arithmetic is exact on the typed decimals; money shows to the cent and the rate to 2 decimals, halves up."
  ],
  "inputs": {
    "$schema": "https://json-schema.org/draft/2020-12/schema",
    "type": "object",
    "properties": {
      "ebit": {
        "title": "Operating income (EBIT)",
        "description": "Earnings before interest and taxes. Negative for an operating loss.",
        "type": "number",
        "x-unit": "USD",
        "minimum": -1000000000000000,
        "maximum": 1000000000000000
      },
      "rate": {
        "title": "Tax rate from",
        "description": "Type a tax rate, or work out the effective rate from the income statement.",
        "type": "string",
        "enum": [
          "rate",
          "taxes"
        ]
      },
      "tax": {
        "title": "Tax rate",
        "description": "The income tax rate on operating income, such as the statutory or effective rate.",
        "type": "number",
        "x-unit": "percent",
        "minimum": 0,
        "maximum": 100
      },
      "taxes": {
        "title": "Income tax expense",
        "description": "Income tax expense on the income statement.",
        "type": "number",
        "x-unit": "USD",
        "minimum": 0,
        "maximum": 1000000000000000
      },
      "pti": {
        "title": "Income before taxes",
        "description": "Pretax income: operating income less interest and other non-operating items.",
        "type": "number",
        "x-unit": "USD",
        "exclusiveMinimum": 0,
        "maximum": 1000000000000000
      }
    }
  },
  "outputs": {
    "nopat": {
      "label": "NOPAT",
      "description": "EBIT × (1 − tax rate).",
      "format": "money"
    },
    "taxOnEbit": {
      "label": "Taxes on operating income",
      "description": "EBIT × tax rate.",
      "format": "money"
    },
    "rateUsed": {
      "label": "Tax rate used",
      "description": "The rate you typed, or income tax expense ÷ income before taxes × 100.",
      "format": "percent"
    }
  },
  "defaultAnswer": {
    "inputs": {
      "ebit": 43000,
      "rate": "taxes",
      "tax": 21,
      "taxes": 6000,
      "pti": 41000
    },
    "outputs": {
      "nopat": 36707.31707317073,
      "taxOnEbit": 6292.682926829269,
      "rateUsed": 14.634146341463415
    },
    "text": "Operating income of $43,000.00 at a tax rate of 14.63% leaves NOPAT of $36,707.32."
  },
  "examples": [
    {
      "given": {
        "ebit": 43000,
        "rate": "taxes",
        "taxes": 6000,
        "pti": 41000
      },
      "expect": {
        "nopat": 36707.31707317073,
        "taxOnEbit": 6292.682926829269,
        "rateUsed": 14.634146341463415
      },
      "source": "Aswath Damodaran, NYU Stern, Variables used in Data Set (after-tax operating income = EBIT (1 − t), the numerator of return on capital and free cash flow to the firm). https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/variable.htm; OpenStax, Principles of Finance, 5.1 The Income Statement (Clear Lake Sporting Goods: operating income $43,000, interest $2,000, income tax expense $6,000, net income $35,000). https://openstax.org/books/principles-finance/pages/5-1-the-income-statement; hand calculation in content.mdx: 6,000 ÷ 41,000 = 14.63%; 43,000 × (1 − 6,000 ÷ 41,000) = 36,707.32 (exact 1505000/41, Python Fraction)"
    },
    {
      "given": {
        "ebit": 1000000,
        "rate": "rate",
        "tax": 21
      },
      "expect": {
        "nopat": 790000,
        "taxOnEbit": 210000,
        "rateUsed": 21
      },
      "source": "Aswath Damodaran, NYU Stern, Variables used in Data Set (after-tax operating income = EBIT (1 − t), the numerator of return on capital and free cash flow to the firm). https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/variable.htm; hand calculation in content.mdx: 1,000,000 × (1 − 0.21) = 790,000"
    },
    {
      "given": {
        "ebit": -50000,
        "rate": "rate",
        "tax": 25
      },
      "expect": {
        "nopat": -37500,
        "taxOnEbit": -12500
      },
      "source": "Aswath Damodaran, NYU Stern, Variables used in Data Set (after-tax operating income = EBIT (1 − t), the numerator of return on capital and free cash flow to the firm). https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/variable.htm; hand calculation in content.mdx: −50,000 × 0.75 = −37,500"
    },
    {
      "given": {
        "ebit": 2500000.5,
        "rate": "rate",
        "tax": 26.5
      },
      "expect": {
        "nopat": 1837500.3675,
        "taxOnEbit": 662500.1325
      },
      "source": "hand calculation in content.mdx: 2,500,000.50 × 0.735 = 1,837,500.3675, shown as $1,837,500.37"
    }
  ],
  "sources": [
    "Aswath Damodaran, NYU Stern School of Business, Variables used in Data Set: after-tax operating income EBIT (1 − t) is the numerator of return on capital, ROC = EBIT (1 − t) ÷ (BV of debt + BV of equity − cash), and of free cash flow to the firm, FCFF = EBIT (1 − t) − (capital expenditures − depreciation) − change in non-cash working capital. https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/variable.htm (retrieved 2026-10-19)",
    "OpenStax, Principles of Finance, 5.1 The Income Statement: Clear Lake Sporting Goods (operating income $43,000, interest expense $2,000, income tax expense $6,000, net income $35,000). https://openstax.org/books/principles-finance/pages/5-1-the-income-statement (retrieved 2026-10-19)",
    "OpenStax, Principles of Finance, 6.4 Solvency Ratios: operating income is earnings before interest and taxes (EBIT). https://openstax.org/books/principles-finance/pages/6-4-solvency-ratios (retrieved 2026-10-19)"
  ],
  "related": [
    "roic",
    "operating-income",
    "ebitda",
    "wacc"
  ],
  "changelog": []
}