What is Net Income from Continuing Operations?

Net income from continuing operations is a line item on the income statement that notes the after-tax earnings that a business has generated from its operational activities. Since one-time events and the results of discontinued operations are excluded, this measure is considered to be a prime indicator of the financial health of a firm’s core activities.

Presentation of Net Income from Continuing Operations

The net income from continuing operations usually appears on the income statement of a larger business with more complex operations. In the following exhibit, we show the bottom part of an income statement for a business that has decided to set aside the financial results of its discontinued operations, and so wants to show its net income from continuing operations above the results associated with its discontinued operations.