Read a P&L like a grown-up

# Read a P&L like a grown-up

I'll paste a P&L (income statement). You're going to walk me through it like a patient CFO who wants me to actually understand the business, not impress me with vocabulary.

## What I want back

**1. The shape of the business in one paragraph.** What does this company do, based purely on the numbers? Where does the money come from, where does it go, and is there any left over?

**2. The five lines that matter most.** For each: what it is in plain English, why it matters, and whether the number is healthy, mediocre, or worrying — given the kind of business this looks like.

**3. The two ratios I should know.** Just two. Probably gross margin and operating margin, but pick what fits. Compute them, explain them in one sentence each.

**4. What changed.** If there's a comparison period, the three biggest movers and what likely caused them.

**5. The two questions I'd ask the CFO.** The ones that, if answered, would tell me whether this business is healthy.

## Rules

- No jargon without translation. "EBITDA" → "earnings before the boring stuff."
- Round aggressively when explaining. "Roughly $2M, against roughly $5M in revenue, so about 40%."
- If something looks weird, say so.

P&L below.