Reviewed by Anthony Battle
Fact checked by Suzanne Kvilhaug

Investing in a 401(k) plan may frustrate those who like to pick stocks. The available offerings through an employer can be limited and 401(k) accounts restrict most owners from withdrawals before age 59½ without penalty.

Choosing stocks and controlling their portfolio allows individuals to avoid 401(k) restrictions but they miss out on tax benefits. According to a study by the Plan Sponsor Council of America, 98% of companies with a 401(k) plan offer matching contributions.

Key Takeaways

• A 401(k) contribution is based on pre-tax income, lowering an individual’s immediate tax bill.
• Taxes are deferred on a traditional 401(k) until retirement.
• Choosing individual stocks requires constant monitoring and early sell-offs may incur capital gains taxes.

The 401(k) Plan

Money invested in a traditional 401(k) is subtracted from pre-tax earnings. Delaying taxes until distribution keeps more money invested in an account during an individual’s working years, which means greater earnings over time. A Roth 401(k) allows individuals to pay income taxes on their contributions up front, and then withdraw the money tax-free in retirement.

Employers commonly match a portion of an employee’s savings in a 401(k). For example, an employer may contribute $1 for every $1 an employee contributes up to 3% of their salary. However, investors can’t touch 401(k) money until they reach age 59½ without paying the income tax due plus a 10% tax penalty. There are certain exceptions, such as disability.

Investment options can be limited to the choices an employer offers. These generally include a range of mutual funds, from conservative to aggressive funds. Individuals cannot predict their retirement tax rate, making it difficult to estimate how much money they’ll have in their funds as they retire.

Important

Employers may offer a target-date fund, an investment fund based on an investor’s retirement year, and rebalanced periodically to optimize returns over the long term as an individual reaches retirement age.

Stock-Picking

Individuals who invest on their own for retirement do not face penalties or have to meet any requirements for withdrawal. They also enjoy the freedom to invest in any financial vehicle. However, they forego the deferred tax advantages of a 401(k) plan combined with an employer match.

“If you invest your retirement directly into stocks instead of a retirement account, you will be subject to taxes on the dividends and capital gains when you sell the stocks. You also have the variability of stock price performance that may require you to sell at an inopportune time. While you may want to buy and hold, the economic outlook may change, requiring you to sell and realize capital gains,” explains Kirk Chisholm, a wealth manager at Innovative Advisory Group in Lexington, Mass.

There’s also the matter of an individual’s skill as an investor. Making significant money over time stock-picking is risky and time-consuming to outperform the overall market. Many investors use index funds to simplify the process.

$66,000

The amount a 401(k) balance would exceed an individual stock-picker’s balance, assuming a $2,000-a-year investment in each with 3% employer matching and a 7% a year growth rate over 35 years.

What Funds Are Available to 401(k) Investors?

Mutual funds are an investment option in 401(k) plans, though some companies may offer exchange-traded funds (ETFs). Both mutual funds and ETFs contain a basket of securities. Mutual funds range from conservative to aggressive in risk tolerance.

What Happens To a 401(k) When an Employee Resigns?

Those who resign may be able to keep the 401(k) with the financial servicer but cannot make any further contributions. Individuals can rollover their old 401(k) to a new one with a new employer or into an Individual Retirement Account (IRA).

What Is a Vesting Period?

A vesting period is a designated time that an employee must be on the job to enjoy benefits, including the 401(k) match. An employer can take back the funds they contributed to an employee’s 401(k) if they do not remain employed until the end of their vesting period. For example, an employer’s 401(k) match vesting schedule may last three years. Those who leave the company after working two and a half years will not receive any of the 401(k) matching contributions made by the company since you were hired.

The Bottom Line

A 401(k) is an easier choice for individuals who do not have the skill or time to choose investments and monitor their portfolio’s performance. Investors must weigh the pros and cons of employer matching, tax benefits, and their risk tolerance to decide where to save their retirement money.

Reviewed by Charles Potters
Fact checked by Suzanne Kvilhaug

Free market capitalism is an economic system that can generate great wealth and prosperity for businesses, nations, and their citizens.

It is also a system that creates winners and losers through competition. While competition can lead to innovation and invention, it can also deteriorate the market share of existing companies. In the worst case, it can lead to bankruptcy.

Market share is a company’s percentage of an industry’s total sales. It is crucial to the financial success of a company.

It’s been widely recognized since the 1970s that companies with greater market share are usually more profitable than those in the same industry with smaller market share.

There are three key strategies that companies often use to regain lost market share:

• Pricing changes
• Promotional changes
• Product changes

All have benefits but can be risky. Read on for details about each strategy.

Key Takeaways

• Market share is the percentage of total industry sales generated by a single company.
• Companies with greater market share are usually more profitable than those in the same industry with smaller market share.
• Companies compete with one another for market share.
• If market share is lost to a competitor, there are several strategies that companies often use to fight back: lower prices, greater marketing efforts, and innovation.
• While the strategies may be successful, they are not certain.

Pricing Changes

Lowering Prices

By lowering prices, companies hope to lure customers away from competitors. The benefit is a higher market share, but it comes at a cost: lower margins per unit.

This strategy is particularly attractive to large companies that have high economies of scale. This allow them to operate at a lower marginal cost than their competitors. Or it can make it possible to operate at a loss, if necessary.

It’s a risky strategy because, once prices drop, it can be hard to raise them again unless the company regains enough market share to muscle out its competitors.

Everybody likes a good sale, and being able to entice customers to return through lower prices can be an excellent short-term strategy.

But keep in mind that when competitors see lower price sales, they often lower prices in turn. This benefits consumers but can lead to a race to the bottom for businesses.

Promotional Changes

Promoting the Brand

Another way a business can regain market share is to change its methods of promotion. This can include increasing the advertising budget and putting the power of branding to work for the firm.

With this strategy, company leaders must identify the specific issues that need to be addressed to regain market share—the reason(s) it lost it, the customer type that switched, and the right audience to target for its promotional efforts.

Such efforts can be very successful. Or, they can be a costly exercise.

For example, national retailer JCPenney notably struggled with rebranding in the 2010 to 2012 period, while competitor Target (TGT) found success in the early 2000s by marketing itself as a higher-end discount retailer.

The combination of advertising, marketing, and promotion can be a tried and true method of regaining market share. Just keep in mind that advertising is an on-going process and the competition is spending money on advertising as well.

Important

Excellent customer service can cause customers to stick with a business even if prices are better elsewhere. It can also cause customers to jump ship to a competitor with higher prices. So customer service may play a role in helping a company maintain, or regain, market share.

Product Changes

Updating Product Offerings

To regain market share, a company can revamp its offerings to better meet customer needs or to provide something new.

Apple (AAPL) tried this tactic in 2014 by introducing the iPhone 6, a significantly changed version of its smartphone. And it met with great success as a result.

An instant hit, the iPhone 6 enabled Apple to take back some of the market share it had lost to Google’s (GOOGL) Android.

The company has continued its strategy of introducing new iPhone versions periodically, launching iPhone 16 on Sep. 20, 2024 and the less costly iPhone 16e on Feb. 28, 2025.

This strategy can be combined with raising prices to introduce another aspect of differentiation or to position the company’s offering as a premium product.

Necessity may be the mother of invention. But competition may be the spur for noteworthy innovation in the business world.

Coming up with new or updated product offerings may help a company regain market share in the short-term. Yet it has to keep innovating and introducing novel and exciting products that consumers will clamor for to maintain or grow that share.

Why Does Market Share Matter?

It matters because it reflects a company’s sales, which are the key to profitability and success.

What Affects Market Share?

Some things that can affect market share—think sales—are product prices, the introduction of new products, customer satisfaction and loyalty, quality of service provided to customers, innovation, product quality, and advertising.

Can a Company Regain Market Share Once It’s Lost?

Yes, it can. To do so, it must assess the problems that caused the loss and address them effectively with one or more strategies that it believes can change consumer attitudes and support greater sales.

The Bottom Line

In free-market capitalist economies, competition between companies can lead to changes in market share.

When a company loses its market share to a competitor, it can try to regain it by lowering its prices, promoting the brand, and updating its product offering.

While none is guaranteed to work, they’re often used by companies with success.

Stockholders should pay attention to this on a company’s balance sheet

Reviewed by Chip Stapleton
Fact checked by Yarilet Perez

An increase in the total capital stock that shows on a company’s balance sheet is usually bad news for stockholders. It represents the issuance of additional stock shares which dilute the value of investors’ existing shares. The additional capital stock may benefit investors, however, in the form of increased returns on equity through capital gains, higher dividend payouts, or both.

Key Takeaways

• Capital stock is the total amount of stock that a public company is authorized to issue.
• It’s the number of shares that can be outstanding or held by shareholders.
• Capital stock includes both common and preferred stock but preferred stock is less common.
• Increases in a company’s capital stock often result in share dilution.
• An increase can be a good thing if the money raised is used to finance company growth.

What Is Capital Stock?

Capital stock is the total amount of common and preferred stock that a public company is authorized to issue. The difference between common stock and preferred stock is that preferred stockholders receive their share of the assets before common stockholders receive theirs if a company goes bankrupt assuming there’s anything left.

Common stock is what investors usually purchase. Companies don’t always offer preferred stock. A company begins its life with a certain amount of equity shares but it might authorize the creation and issuance of additional shares if it’s approved by the board of directors and existing shareholders.

Capital stock is the number of shares that can be outstanding or held by shareholders. The amount of capital stock that a company issues is usually stated initially in its company charter. This is the legal document that’s used to start a corporation. A company commonly has the right to increase the amount of stock it’s authorized to issue through approval by its board of directors and amendment to the charter, however.

It also has the right to buy back existing shares from stockholders or issue more shares for sale.

Important

Investors can find information about a company’s capital stock in the shareholders’ equity section of its balance sheet.

Disadvantages of Increasing Capital Stock

Increases in the total capital stock can negatively impact existing shareholders because it usually results in share dilution. The company’s diluted EPS figure will drop as the company’s earnings are divided by the new, larger number of shares to determine the company’s earnings per share (EPS).

Benefits of Increasing Capital Stock

Increases in capital stock can ultimately be beneficial for investors despite possible dilution of shares. The increase in capital for the company that’s raised by selling additional shares of stock can finance additional company growth. The ultimate gains in stock price and dividend payouts realized by investors might be more than sufficient to compensate for the dilution of their shares if the company successfully invests the additional capital.

What Is Share Dilution?

Share dilution occurs when a company issues additional shares to more shareholders. The company may have initially issued 10,000 shares. The value of those shares drops by half if the company then issues an additional 10,000 shares. Each existing share represents a smaller percentage of ownership and makes the shares less valuable.

What Are Capital Gains?

An investor realizes a capital gain when they sell an asset for more than their adjusted basis in it. The adjusted basis is typically what they paid for it plus any additional, qualifying costs of owning it.

This has some significant tax implications because capital gains can be taxed at lower rates than ordinary income depending on the duration of the ownership period and the overall wealth of the investor. Capital losses can additionally be subtracted from gains subject to some rules, reducing the taxable amount.

How Are Dividends Paid?

A dividend is effectively a percentage of a company’s profits. An investor who buys a dividend-paying share will receive a portion of the company’s additional profits if the company makes money. Dividends are often paid in cash but they can be in the form of additional stock shares.

The Bottom Line

Investors and analysts become wary when a company continually initiates additional stock share offerings. This often indicates that the company is having difficulty maintaining financial solvency with its current revenues. It may be in constant need of additional financing.

It’s typically a good sign to investors and analysts if a company can issue a significant amount of additional stock without seeing a significant drop in share price, however.

Reviewed by Charlene Rhinehart
Fact checked by Yarilet Perez

Profits vs. Earnings: An Overview

Profits and earnings are often used interchangeably, but they are different. Overall, these terms are primarily differentiated by the adjectives that precede them. For example, net earnings, or gross profit.

The term earnings is most commonly used when discussing the bottom line of a company’s income statement. The term profit is commonly associated with the three most important points on the income statement: gross profit, operating profit, and net profit. These items reflect a company’s operational efficiency.

Key Takeaways:

• Profits and earnings are often used interchangeably, but they reflect different items found in the financial statements.
• Gross profit, operating profit, and net profit are the three main measures analysts evaluate on an income statement.
• The net earnings are found on the bottom line of an income statement.
• Net earnings show the total earnings a company has achieved after subtracting all expenses. 
• The net earnings value carries over into the balance sheet and cash flow statement for a company’s reporting period.

Profits

The gross profit margin, operating profit margin, and net profit margin are three key profit measures. Analysts use this data to analyze a company’s income statement and operating activities. The adjectives “gross,” “operating,” and “net” describe three distinctly different profit measures that help to identify the strengths and weaknesses of a company.

Gross Profit

Gross profit, which is used to calculate gross profit margin, is a measure that analyzes a company’s cost of sales efficiency. The costs of sales figures include only direct expenses involved in generating a company’s products. The higher the gross profit and gross profit margin, the more efficiently a company is creating the core products that build its business.

Operating Profit

Operating profit is an analysis of a company’s indirect costs. Operating profit is in the second section of an income statement. The operating profit is calculated by subtracting all of a company’s indirect costs from the gross profit.

An analyst can see what types of endeavors a company is taking on to help grow the business from the indirect costs. For example, indirect costs associated with operating profit margin may include marketing campaign expenses, general and administrative costs, and depreciation and amortization.

The operating profit margin is calculated by dividing operating profit over sales. This ratio allows an analyst to compare a company’s gross profit efficiency versus operating profit efficiency and to see how direct cost management differs from indirect cost management.

Net Profit

Net profit is calculated from the final section of an income statement. It is the result of operating profit minus interest and taxes, with interest and taxes being the last two factors to influence a company’s total earnings. Net profit is used in the calculation of net profit margin, which gives the final portrayal of how much a company is earning per dollar of sales.

Note

Common profitability ratios include gross profit margin, operating margin, return on equity, EBITDA margin, and earnings per share (EPS).

Earnings

Earnings are most commonly associated with a company’s bottom-line results. The bottom line shows how much a company has earned after subtracting all of its expenses. This measure can be referred to as net profit, net earnings, or net income.

The net earnings of a company are the earnings after all expenses have been subtracted. Net earnings are then used to calculate a company’s earnings per share (EPS), which portrays a company’s earnings based on the number of publicly traded equity shares it has outstanding.

Overall, earnings are the net value a company has achieved from operating activities for a specific reporting period. Companies also portray their net earnings by dividing it over shares outstanding when identifying the earnings per share (EPS) value.

The net earnings of a company theoretically reflect an accounting value for a specific period. After the net earnings are calculated, this value flows through to the balance sheet and cash flow statement.

On the balance sheet, net earnings are included as retained earnings in the equity section. Retained earnings for the balance sheet are calculated as beginning retained earnings plus net income minus dividends. On the cash flow statement, the net earnings begin the top line of the operating activities section.

Special Considerations

The terms profit and earnings should be evaluated in context. Gross profit and operating profit are terms used to analyze the first two segments of a company’s income statement.

The bottom line, net earnings, will have a different connotation. Net earnings can also be expressed as net income or net profit. The net earnings of a company provide the most comprehensive measure of a company’s performance after all expenses are subtracted.

Ultimately, net earnings may be the most important number on the income statement because it comprehensively shows the company’s total earnings performance and the value carried over to the balance sheet and cash flow statement.

What Is the Difference Between Revenue and Profit?

Revenue is all the money a business earns from sales. Profit is what is left after subtracting all of the costs a business incurs, such as supplies, rent, and utilities. For example, if you sold 20 glasses of lemonade for $5 each, your revenue would be $100. If your costs to make and sell those 20 glasses of lemonade, including sugar, lemons, and cups cost $2 for each glass, your total costs would be $40. Your profit would be $60 ($100 – $40 = $60).

What Is EBITDA?

EBITDA stands for “earnings before interest taxes depreciation and amortization.” It is a profitability measure to assess how much money a business is making through its core operations. It excludes the above costs which can vary based on accounting methods, tax situations, and financing decisions. It helps to know how a company is doing without these other variables and it makes comparison between companies easier.

What Is Earnings Per Share (EPS)?

Earnings per share (EPS) is a financial metric that compares a company’s earnings to the number of shares of common stock outstanding. It is calculated as a company’s net income divided by the total number of common shares outstanding. Investors and analysts use EPS to understand how much profit a company is generating from each share. A higher EPS is generally better.

The Bottom Line

The difference between profit and earnings is the specific financial metrics they represent. While profit appears in multiple forms (gross, operating, and net), earnings usually refer to the bottom line figure after all expenses are deducted. Each provides important insight into a company’s financial health.

It can be more difficult, but it’s still possible. Here is what you need to know.

Fact checked by Rebecca McClay

If you need a personal loan and are currently unemployed, you may face a few more obstacles than if you had a steady job and regular paycheck. But it is still possible to obtain a loan if you can offer lenders other evidence that you’re a good risk. Here is what you need to know and do.

Key Takeaways

• You may be able to obtain a personal loan even if you’re out of work and not receiving a regular income.
• However, getting approved for a loan could be more difficult.
• Without a current income, the lender is likely to focus heavily on your past credit history.
• You may also have alternatives to a conventional personal loan, such as a secured loan.

Can You Get Approved for a Personal Loan if You’re Unemployed?

Being out of work doesn’t automatically make you ineligible for a personal loan. Lenders will consider not only your employment status but also other factors, such as your credit history and current credit score. Here are some steps that can improve your odds.

Calculate How Much You Actually Need to Live On

It’s never a good idea to borrow more money than you need. That’s doubly true when you’re unemployed and aren’t sure how soon you’ll have more money coming in. So before you apply, try to arrive at a realistic number.

If you’re looking to take out a loan to cover your monthly bills and regular living expenses, add them up using your bank and credit card statements for reference. Then multiply that monthly amount by the number of months you think you might be out of work.

Also, consider any other income you might have that could cover at least some of your expenses and reduce your borrowing needs, such as unemployment benefits, severance payments, or investment income.

While you’re at it, take a hard look at any costs you could trim for at least the time being. That could also lower the amount you need to borrow.

Weigh Your Ability to Repay

Any lender you apply to will carefully weigh your ability to repay. You should be weighing that, too. For one thing, you don’t want to get into a position where you default on the loan, which can seriously damage your credit score—harm that could last long after you’re back at work.

In addition, if you’re already struggling with your cash flow, adding a new loan payment to the mix could put you in a tight squeeze, especially if you have to pay a high interest rate or borrow any more than absolutely necessary.

Check Your Credit Reports and Credit Score

Almost any lender you apply to, except possibly a loan shark, will review at least one version of your credit report and one or more of your latest credit scores. You should obtain these, as well, both to know where you stand and to correct any errors that put you in a bad light.

By law, you’re entitled to a free copy of your credit reports from each of the three major credit bureaus—Equifax, Experian, and TransUnion—at least once a year and sometimes more often. Their reports usually contain much the same information but can sometimes vary slightly. The official website for all three bureaus is AnnualCreditReport.com.

You can read and print out your credit reports online, so you don’t have to wait for them to come in the mail. When you go over a report, check for any errors, such as accounts you don’t recognize or bills that show up as delinquent that you are pretty sure you’ve paid. These kinds of errors can happen, and the credit bureaus must investigate them and report their findings back to you if you raise questions.

Your credit score is not included in your credit reports, although the information from your credit reports is what’s used to calculate it. You can often obtain your credit score free of charge from your bank or credit card companies. Scores can also be available from reputable online sources.

Because there are a variety of different credit-scoring models, you probably have several credit scores, and the lender may look at a score that varies somewhat from whichever one you obtain. However, they should be pretty close. If your credit score turns out to be abysmal, consider waiting a while before you apply for a loan, if at all possible, and using that time to try to improve your score.

Gather Your Paperwork

Lenders will indicate what sorts of documentation they expect you to supply. That might include bank and investment statements, a recent tax return or two, pay stubs, or other evidence of how much you made in your last job. (Even though you no longer have that job, this gives lenders an idea of your earning capacity.) Having all the necessary materials on hand before you apply can make the process go more quickly and smoothly.

Be Ready to Explain the Loan’s Intended Use in Your Application

Not all lenders will ask what you plan to use the loan for, but some will. Obviously, the more sensible your answer, the better. (Hitting the casinos, for example, would be a poor answer.)

Consider a Co-Signer

If you’re unable to qualify for a personal loan on your own, recruiting someone to co-sign for you could be an option. A cosigner might be a family member or close friend, and should be a person with a solid credit score.

Important

Co-signing isn’t a matter for either you or the co-signer to take lightly. If you’re unable to pay back the loan, for whatever reason, the co-signer is legally on the hook for it.

Consider Offering Collateral

Another option is to apply for a secured personal loan and put up some form of valuable collateral, such as a car, your home, or investments you own. While most personal loans are unsecured, secured ones are less risky for lenders, so they can be easier to obtain. Bear in mind, of course, that if you can’t repay the loan, the lender can seize your collateral.

Factors That Lenders May Use to Evaluate Your Loan Application

In most instances, lenders will look at your finances from several different angles in deciding whether to make a loan and for how much money. Three major factors are:

• Your credit score and credit history
• Your income
• Your current debt-to-income ratio, or DTI

Credit Score and History

As mentioned above, both your credit report and credit score can be of prime importance to lenders who are considering you for a personal loan, particularly an unsecured one. Obviously, the cleaner your report and the higher your score, the better your chances of approval. But nearly as important, the better you look from a credit perspective, the more likely you are to qualify for favorable terms, such as a larger loan, a longer repayment period, or a lower interest rate.

Income

Even though you might not have a regular paycheck at the moment, you may have other sources of income that will give lenders some confidence in your ability to make loan payments. Those can include:

• Unemployment benefits
• A spouse or other partner’s income
• Alimony or child support
• Social Security or veterans benefits
• Interest and dividends from savings and investments
• Rental income
• Any income from a side job or part-time work

Debt-to-Income (DTI) Ratio

Your debt-to-income ratio (DTI) is a common metric used by lenders when you apply for any kind of credit. It compares your current monthly debt payments to your available monthly income. The higher your DTI, the greater the risk you are assumed to be. In general, you’ll need a DTI of 35% or less to obtain a personal loan at a reasonable interest rate, although lenders will vary in their requirements.

Where to Apply for a Personal Loan While Unemployed

Personal loans are available from a range of sources, some of which have special programs for people with poor credit or who are facing financial emergencies.

Banks and Credit Unions

You might want to start with any bank or credit union where you currently do business. You are already a known quantity there, and they may look more favorably on your application. If you don’t belong to a credit union but are interested in joining, you can find one by using the National Credit Union Administration’s Credit Union Locator.

Online Lenders 

Online lenders have become an increasingly important source of personal loans. Some are affiliated with traditional banks, others do business strictly online. These lenders offer a relatively easy application process and often quick approval (or rejection). Their websites typically describe their income requirements, if any, so you can save yourself some trouble and apply only to those where you seem likely to qualify.

Alternatives to Personal Loans

A personal loan may not be your only, or even best, option if you’re unemployed. A few others to consider:

• A home equity loan or line of credit. If you own your home and have sufficient equity in it, you could be eligible for a home equity loan or home equity line of credit (HELOC). On the upside, they often have attractive interest rates. On the downside, they are secured by your home, so you’re putting it at risk if you can’t repay.
• A credit card cash advance. Credit card cash advances can be an expensive way to borrow money, but they’re one option in an emergency.
• A family loan. If you have family members who can help you get through a rough patch, borrowing from them could be a possibility. They might not even charge you interest. If you decide to go this route, most experts suggest putting the terms in writing to avoid any misunderstandings down the line.

The Bottom Line

If you’re out of work, you aren’t necessarily out of luck when it comes to obtaining a personal loan. But, as with all loans, be sure to compare terms carefully and try not to get in too deep. With any luck, you’ll be back at work soon—and might even be able to pay back the loan ahead of schedule.

Reviewed by Margaret James
Fact checked by Suzanne Kvilhaug

What Are Business Ethics?

Business ethics are the moral principles and values that guide the operations of a company or business, and the behavior of management and employees.

Common issues that fall under this umbrella include employer-employee relations, discrimination, environmental issues, bribery, insider trading, and social responsibility.

Many laws exist to set basic ethical standards within the business community, but it is largely dependent upon the leadership of business to develop a code of ethics.

While practicing strong ethics keeps a business within the parameters of the law, it can also serve to build goodwill and brand equity.

That’s because popular social issues often drive business ethics. When different issues come to the forefront, organizations respond by bringing their ethical tenets in line with new social norms.

Key Takeaways

• Business ethics guide a company’s operations and employee behavior and deal with such things as environmental issues, social responsibility, and employee-employer relations.
• While laws related to business ethics exist, it is up to each business to establish a code of ethics.
• Business ethics saw a notable shift in the 1960s when more companies started embracing social responsibility.
• They saw another transition phase in the 1970s and 1980s when philosophy shifted from pure authoritarianism toward greater collaboration with employees.
• An important ethical consideration in the 21st century is maintaining consumer privacy as companies mine user information for valuable marketing data to use and potentially sell.

Business Ethics in the 1960s

The 1960s brought the first major wave of changes in business ethics. Cultural values were shifting, with individualism and fierce dedication to social issues such as environmentalism and world peace coming into vogue.

While young workers in the 1960s were idealistic and wanted to make the world a better place, employers found that their general work ethic, compared to that of previous generations, was lacking.

Drug use was rampant, and the new focus on individualism caused many workers to look upon their employers with disdain.

Companies responded to the changing times by beefing up human resources departments, establishing mission statements, and outlining codes of conduct.

However, in response to the changing desires of their employees, businesses also began embracing social responsibility at a level not previously seen.

In fact, the 1960s saw businesses trumpet environmental friendliness for the first time and companies also looked for new ways to give back to their communities.

Major Events in the 1970s and 1980s

During the 1970s and 1980s, two events shaped changes in business ethics: defense contractor scandals that became highly publicized during the Vietnam War and a heightened tension between employers and employees.

In response, the government implemented stricter policies governing defense contractors, and companies revamped contracts with employees to focus less on rigid compliance and more on values.

Popular management philosophy shifted from pure authoritarianism toward more collaboration with employees (and communities) and working on an equal footing.

Important

Business ethics change over time as the values of individuals and institutions change. They evolve to incorporate moral principles that reflect these specific changing values and may continue to deal with them despite the passage of years.

The 1990s and Environmentalism

The 1990s saw a rebirth of environmentalism, new heights in social responsibility, and graver legal ramifications for ethical missteps.

For example, tobacco companies and junk food manufacturers faced heightened scrutiny, along with several important lawsuits over the public health ramifications of their products.

Oil companies and chemical companies had to contend with increasing public pressure to answer for environmental damage. Class action lawsuits rapidly gained in popularity and, in response, businesses were forced to spend more on legal departments.

The Online Realm of the 21st Century

From the year 2000 onward, business ethics expanded to encompass the online realm. The big ethical dilemmas of the 21st century have centered on cybercrimes and privacy issues.

Crimes such as identity theft, almost unheard of 20 years before, are a threat to anyone doing business online.

As a result, businesses face social and legal pressure to take every measure possible to protect sensitive customer information.

The rise in the financial value and popularity of data mining and target marketing for businesses has forced companies to walk a fine line between protecting consumer privacy and using online activities to glean valuable marketing data.

Business Ethics in the AI Age

The emergence of artificial intelligence (AI) as a growing force in business has presented new challenges that people and companies are striving to deal with.

The many changes in business and society that could take place over the years as AI technology continues to develop may be highly consequential for businesses.

Companies Developing AI

According to a 2023 study conducted by the Markkula Center for Applied Ethics at Santa Clara University, a vast majority of Americans care that AI be ethical.

Approximately 86% felt that AI companies should be regulated and 82% felt the U.S. government should clarify those regulations.

And despite some businesses involved in AI development (such as IBM and Microsoft) having some clear degree of AI ethics focus, over half of Americans believe that companies haven’t been concerned with or by ethics as they’ve developed AI technology.

Companies Using AI

Business ethics must apply not just to the development of AI but also to its use by myriad businesses. Fairness, transparency, and accountability have become watchwords for such ethics.

Business ethics could play a large role in helping companies avoid business risks associated with AI and in creating positive social change, both major benefits for businesses.

When Did Business Ethics Start?

The term “business ethics” started becoming familiar to people in the 1970s, with the rise of the academic discipline at colleges and universities. The idea of ethics in the conduct of business could be understood to have started with the origin of business.

Why Do Business Ethics Matter?

They matter because, when practiced by companies, they inspire confidence and feelings of trust in customers, stakeholders, and the public. They help companies avoid mistakes that could hurt or ruin their chances of success. And because moral leadership plays an important, positive role in the health of societies and provides examples for others to follow.

What Are Some Major Concerns of Business Ethics?

Matters such as discrimination, harassment, data privacy, health and safety, and fraudulent accounting are major issues associated with business ethics.

The Bottom Line

Business ethics have evolved since the 1960s, as the important social and business issues that they address have changed.

The list of concerns has grown from such matters as workplace fairness, environmentalism, war, and social upheaval to include social responsibility, harassment, workplace and public safety, accounting transparency, and personal data privacy.

Reviewed by Somer Anderson
Fact checked by Vikki Velasquez

A profit margin is considered to be one of the most important indicators of a company’s viability. Many factors influence this financial metric—two of them being quantitative and qualitative. As such, they aren’t reflected in your calculation’s variables. Quantitative factors are easily identifiable because they can be measured while qualitative factors tend to be subjective because they are non-numerical.

Key Takeaways

• The most direct factor that affects profit margins is your net or gross profit.
• One of the easiest and fastest ways to adjust profit margins is to adjust the sale price of a product or service.
• While most margins can be explained quantitatively, external factors such as consumer sentiment, halo effect, and other emotional factors can factor in as well.

What Is a Profit Margin?

A profit margin is a profitability measure. It determines how much profit a company earns relative to its revenue. There are several types of profit margins, including operating, gross, and net profit margins. In this article, we’ll focus on net profit margin because many more factors influence net profits than gross or operating profits.

Net profit margin is the ratio of net income relative to revenues, calculated by simply dividing net profit by revenue or sales. This is a quick way to determine the percentage of your sale price your company keeps after accounting for the costs that went into the sale.

Net Profit Margin = Net Income ÷ Sales

Net profit margin is a better representation of financial health than revenues alone. It is possible to increase your company’s earnings while decreasing your profit margin. This means that your company becomes relatively less efficient. When the company loses money, it ends up with a net loss instead of a net profit.

Note

Nearly all aspects of your company’s operations affect your profit margin. This includes your management, branding, marketing strategy, and even floor sales tactics affect your profit margin.

Quantitative Factors

The most obvious numbers that affect a company’s profit margins are broad and easily identifiable. These are:

• Net profits: Also called net income, this is the company’s bottom line. This figure is the company’s profits after deducting expenses, taxes, operating costs, and interest from its revenue.
• Sales earnings: This figure represents the total amount of money generated from sales before any costs or expenses are deducted.
• Merchandising costs: These are direct costs associated with producing and selling goods and services. They include shipping and insurance among others.

Look at net revenues and the cost of goods sold (COGS) on the income statement for a very general view of these major variables.

Inventory numbers matter, too. Even though inventory is recorded as an asset on the balance sheet, sales revenues aren’t recorded until the transaction takes place. Devalued inventory can hurt profit margins, so getting rid of inventory through increased sales can help profit margins.

Taxation is an underrated variable and one that can’t be controlled. That’s because taxes affect net income.

You can also dig a little deeper to get a better picture of a company’s net profit margin because sales prices become very important factors. Note that companies can increase their net profit margins by doing a good job of managing their merchandise costs. They can increase their sales prices at the same time.

Qualitative Factors

There are too many qualitative factors to list in a short article. Qualitative factors are non-numerical, which means they can’t be easily calculated. Rather, they are subjective, which means they rely on knowledge and insights to be determined.

Consider all of the elements that might affect the sale of any given product, such as market share, effective advertising, seasonal changes, consumer preferences, company leadership, sales reward programs, and employee training programs. These are just some of the qualitative factors that can have an impact on a company’s profit margins.

How Can Companies Increase Their Profit Margins?

Companies can take different steps to improve their profit margins. The first and most obvious way to do so is to cut down on costs. This can be as simple as eliminating waste and streamlining operations. Other ways to increase profit margins include improving relations with vendors and suppliers, taking advantage of bulk buying, and improving inventory management. If all else fails, they can also raise prices.

What Is Operating Profit?

Operating profit refers to the profit or net income a company generates from its core business operations. It deducts any operating expenses and excludes the deduction of taxes and interest. You can calculate a company’s operating profit by subtracting operating expenses, depreciation, and amortization from its gross profit.

What Are the Four Types of Profit Margins?

The four types of profit margins are gross profit margin, operating profit margin, pretax profit margin, and net profit margin. They reflect how much sales revenue a company gets to keep as profit after deducting relevant costs. Profit margins are generally expressed as a percentage

The Bottom Line

Many analysts and investors take profit margin so seriously because it can contain an enormous amount of information about a company into one efficient, easy-to-understand number. Companies can improve their net margin when the take certain actions. Actions include boosting sales, increasing the price of their product or service, and cutting costs.

Fact checked by Suzanne Kvilhaug

What Is Form W-9: Request for Taxpayer Identification Number (TIN) and Certification?

Form W-9, Request for Taxpayer Identification Number (TIN) and Certification, is an Internal Revenue Service (IRS) tax form that businesses use to collect information from independent contractors, freelancers, and other vendors. Businesses use this information to file paperwork with the IRS for tax reporting purposes.

When businesses pay a nonemployee, such as a freelancer or independent contractor, $600 or more in a year, they must file Form 1099-NEC, which is filled out using the information on Form W-9. Form W-9 can also be used to complete other versions of the 1099, such as the 1099-MISC, or Form 1098. Copies of the 1099 are then sent to both the IRS and the independent contractor; the independent contractor uses Form 1099 to complete their own tax return.

Key Takeaways

• IRS Form W-9 transmits taxpayer identification information between two parties.
• Form W-9 isn’t filed with the IRS; instead, it is used to complete Forms 1099 and 1098.
• Form W-9 asks taxpayers for their name, taxpayer identification number (TIN), address, and other information about them or their business.
• Form W-9 can be filled out by U.S. persons, including individuals, sole proprietors, trusts, corporations, and other entities.

Who Needs to Fill Form W-9?

The most common reason for filling out Form W-9 is having income paid to you that you didn’t receive as an employee. This could be income as an independent contractor or freelancer; it could also be things like royalties or speaker fees for an event.

Other reasons you could be asked to fill out a W-9 include:

• Some types of real estate transactions
• Mortgage interest payments
• Cancellation of debt
• Contributions to an individual retirement account (IRA)
• Abandonment or acquisition of secured property

Important

Form W-9 is only used to collect information from U.S. persons, including resident aliens. A U.S. person can be an individual, corporation, partnership, domestic trust, or estate.

How to Fill Out Form W-9

Form W-9 is available on the IRS website. It is filled out in three sections.

The first section of the form asks for seven pieces of information:

1. Name as it appears on your tax return
2. Any business name or “disregarded entity” name (such as a “doing business as” name) that is different from the name on your tax return. If you don’t do business under a different name, leave this section blank.
3. Federal tax classification. Check one box to choose individual/sole proprietor, partnership, C corporation, S corporation, trust/estate, limited liability company (LLC), or “other.” If you have never filed any paperwork to become a specific business entity, you are likely an individual/sole proprietor.
4. Exemptions you qualify for, which are listed by number code on page 3 of the form, including any exemption from Foreign Account Tax Compliance Act (FATCA) reporting. Most independent contractors and freelancers will leave this section blank.
5. Address for you or your business; usually the address that appears on your tax return
6. The name and address of the requester, which is optional but may be useful for your own records. (This section does not have a number.)
7. Account numbers, which may be necessary if the entity requesting your W-9 is a bank or brokerage. This section will not usually need to be filled out.

The second section, Part I, asks for your taxpayer identification number (TIN). This will be either your Social Security number (SSN) or employer identification number (EIN).

Finally, in Part II, you must certify under penalty of perjury that:

• You have given your real and correct TIN.
• You are not subject to backup withholding.
• You are a U.S. citizen or other U.S. person.
• You have correctly entered any FATCA codes.

If the IRS has notified you that you are subject to backup withholding, cross out Item 2 under the certifications list. If you willfully and incorrectly represent this or any other information on your W-9, you may be subject to criminal or civil penalties.

What Happens After You Complete Form W-9

If you complete Form W-9, you do not need to send it to the IRS. Instead, submit it to the business that requested it. Use caution when transmitting it: The information on a W-9 is sensitive and should be handled with care by both parties to prevent identity theft.

The business will then use the information on the form to fill out the appropriate Form 1099 or 1098. One copy of the 1099/1098 is sent to the IRS; the other will be sent to you. You will then use this information to complete your income tax return.

Substitute Form W-9

The IRS allows someone requesting a W-9 to create and use their own version of the form rather than the one provided by the IRS, as long as it satisfies certain requirements. This is referred to as a substitute Form W-9. The substitute Form W-9 must be substantially similar to IRS Form W-9, including certifying under penalty of perjury that:

• The payee’s TIN is correct.
• The payee is not subject to backup withholding.
• The payee is a U.S. person.
• Any FATCA code entered is correct.

The Bottom Line

IRS Form W-9 is used to share taxpayer information between two parties, often between a business and an independent contractor, freelancer, or vendor. It is used to ensure that any payments a business makes are properly recorded on Form 1099 or 1098 and then reported to the IRS as income.

A W-9 must be certified under penalty of perjury. Deliberately including false information on a W-9 could result in civil or criminal penalties. If you are unsure about how to correctly fill out your W-9, talk to an accountant or other financial advisor.

Retail sales in North America are the biggest sales driver but cloud services bring in the most operating income

Reviewed by David Kindness

Amazon.com Inc., the world’s largest online retailer, has grown rapidly in a broad range of businesses, including its core e-commerce operations, cloud services, and digital advertising. It also sells products such as the Alexa personal assistant and ecosystem, Kindle e-reader, Fire TV, and movies and television shows through its Amazon Prime Video platform. Amazon’s rivals include Walmart Inc. (WMT) and Alibaba Group Holding Ltd. (BABA).

Key Takeaways

• Amazon makes money through retail, subscriptions, and web services, among other channels.
• Retail remains Amazon’s primary source of revenue, with online and physical stores together accounting for the biggest share.
• Amazon Web Services (AWS) currently generates the majority of Amazon’s operating income and is growing at a robust pace.
• Amazon announced that its AWS segment will offer new AI certifications for people looking to improve their skills in AI and machine learning to remain competitive in the job market.

Amazon’s Financials

For Q1 2024, Amazon (AMZN) posted total net sales of $143.3 billion; an increase of 13% from the same period in 2023. The company posted a net income of $10.4 billion; an increase of 228.8%. The increase in net income comes from a growth in net sales without as large of a growth in operating expenses; in short, the company was able to grow net sales while keeping operating expenses down.

Amazon’s Business Segments

Amazon divides its business into three segments: North America, International, and AWS (Amazon Web Services). The first two of these segments, North America and International, refer to geographical breakdowns of Amazon’s retail business. They generate revenue from retail sales in North America and the rest of the world, as well as from subscriptions, advertising, and export sales for those areas. The AWS segment consists of Amazon’s cloud services business.

Retail can be broken down further into online stores, comprising the bulk of sales, and physical stores. Company-wide, online stores accounted for $54.7 billion in sales in Q1 2024, while physical stores generated $5.2 billion in sales.

North America

The North America segment consists of retail sales from consumer products, advertising, and subscription services in North America-focused online and physical stores.

Amazon’s North America segment dominates its net sales, bringing in $86.3 billion for Q1 2024. That is a 12% increase from the same period in 2023. North America net sales made up about 60% of the company’s total net sales in Q1 2024. The segment posted an operating income of $5 billion; an increase of 455% year-over-year (YOY). The segment made up 32.6% of the total company operating income for the quarter.

International

Amazon’s International segment consists of Amazon’s retail business for consumer products, advertising, and subscriptions for internationally focused online stores.

The International segment brought in sales of $31.9 billion for Q1 2024; an increase of 10% YOY and making up 22% of company net sales. The segment had an operating income of $903 million, which was a significant increase from the $1.2 billion loss from the same period in 2023. The segment made up 5.9% of the company’s operating income for Q1 2024.

Amazon Web Services (AWS)

Amazon Web Services (AWS), launched in 2006, provides cloud services to businesses, government agencies, and academic institutions to store information and deliver content. AWS provides an infrastructure platform in the cloud for a variety of solutions such as hosting applications and websites, providing enterprise information technology (IT), and content delivery.

Amazon controls about a third of the global cloud market, substantially more than its next closest competitor. AWS’s biggest rivals are Microsoft Corp.’s (MSFT) Azure and Alphabet Inc.’s (GOOGL) Google Cloud.

Amazon’s AWS segment generated net sales of $25 billion for Q1 2024; an increase of 17%. It accounted for 18% of total net sales. Operating income for the segment was $9.4 billion; an increase of 84%. The segment accounted for 61.5% of operating income in Q1 2024.

Amazon’s Recent Developments

From telehealth to cancer research, Amazon has made a push into healthcare since 2018 by amassing healthcare businesses and launching Amazon Pharmacy.

The subscription service, called RxPass, launched on January 24, 2023, and provides access to commonly prescribed generic medications that treat more than 80 health conditions. The company reports that Amazon pharmacists or support staff will be available at all times to discuss medications and coordinate with a patient’s doctor.

In June 2024, Amazon announced that AWS would be providing two AI certifications, focused on AI and machine learning, so individuals can grow those skills and be competitive in the marketplace for jobs.

In June 2024, Amazon announced that its Counterfeit Crimes Unit (CCU) took action to dismantle illegal online schemes that were intended to evade Amazon’s product approval process. The unit filed six lawsuits against these perpetrators.

What Is Amazon’s Main Business?

Amazon divides its business into three segments: North America, International, and AWS (Amazon Web Services). “North America” and “International,” refer to geographical breakdowns of Amazon’s retail business. These two business segments generate revenue from retail sales, subscriptions, and export sales. AWS provides cloud services to businesses, government agencies, and academic institutions to store information and deliver content.

Is Amazon the Biggest Company in the World?

Amazon ranks as one of the world’s largest companies by market cap and revenue. As of March 2025, Amazon has a market capitalization of $2 trillion and reported $575 billion in revenue (TTM as of December 31, 2023), making it the second-largest company by revenue and the fourth by market cap. For context, some of the largest companies in the world have market caps of trillions of dollars. This makes these companies larger and more valuable than some countries’ entire economies.

How Does Amazon Make Most of Its Money?

Retail is Amazon’s primary source of revenue, with online and physical stores together accounting for the biggest share. In Q1 2024, Amazon reported $143.3 billion in retail sales. Of that, $86.3 billion belongs to its North America business segment and $31.9 billion to its International business segment.

The Bottom Line

Amazon ranks as one of the world’s largest companies by market cap. It dominates the retail space and has grown significantly since its founding as the Internet boomed and people began shopping online. While Amazon started by selling books, it has branched out into selling almost every type of consumer product, as well as offering media services, cloud services, and more.

Nvidia’s Compute and Networking segment supercharges revenue growth

Reviewed by Thomas J. Catalano

Nvidia (NVDA), a multinational technology company, introduced and innovated the graphics processing unit (GPU). A GPU is a hardware component originally designed for a specific purpose: to render and display images, videos, and animations. Now, they are used in a wider range of applications, including creative production. machine learning, and artificial intelligence (AI). Nvidia has continued to deliver leading-edge graphics developments through its groundbreaking GPU efforts.

Currently, Nvidia’s greatest source of revenue is its Compute and Networking business segment, which includes artificial intelligence (AI). The company has become a full-stack (from front-end to back-end) computing infrastructure company that is reshaping a diverse range of complex computing processes.

In addition to the GPUs that Nvidia designs and manufactures for gaming, cryptocurrency mining, and other professional applications, the company also creates chip systems for use in vehicles, robotics, and other tools.

Key Takeaways

• Nvidia (NVDA) introduced and innovated the graphics processing unit (GPU), which is a key component of PC architecture and large-scale applications.
• Nvidia designs and sells GPUs for gaming, cryptocurrency mining, and professional applications; the company also sells chip systems for use in vehicles, robotics, and more.
• Nvidia’s Compute and Networking business segment, which includes artificial intelligence (AI), is the company’s biggest revenue generator.
• The Graphics business segment is Nvidia’s second largest revenue generator.

Nvidia’s Industry

Nvidia is a leading company in the semiconductor industry and is part of the greater information technology sector.

The company’s goal is to offer technology solutions for increasingly complex computational challenges. AI has been a major focus for years, and this focus has intensified in recent years as AI technology has made significant developments—and public interest in the potential uses and impact of AI has grown.

According to its 10-K filing, Nvidia believes that the market for its products faces intense technological change and changing industry standards.

It is also an extremely competitive market, where performance, product offerings, and access to customers, partners, and distribution channels are critical factors. Other key issues it must address are software support, the ability to conform to industry standard APIs, manufacturing strengths, processor pricing, and total costs.

Competitors

It has a variety of competitors in different areas of the industry. Some of them are hardware and software suppliers and licensors, such as Intel Corp. (INTC), Advanced Micro Devices (AMD), and Huwei.

Cloud services companies also engaged in designing AI computing functionality—including Alibaba Group (BABA), Alphabet Inc. (GOOG), Amazon Inc. (AMZN), and Microsoft (MSFT)—are also major competitors.

Nvidia’s Financials

As of March 2025, Nvidia’s market capitalization was $2.89 trillion.

In February 2024, Nvidia announced its financial results for the 2024 fiscal year (FY). In May 2024, the company announced its financial results for the first quarter (Q1) of the 2025 FY, the three-month period ended April 28, 2024.

file:///Users/katelynpeters/Downloads/NVIDIAAn.pdf

https://nvidianews.nvidia.com/news/nvidia-announces-financial-results-for-first-quarter-fiscal-2025

Revenue

For the entire 2024 fiscal year, revenue was $60.9 billion, up 126% from the previous fiscal year result. They had a record quarterly revenue of $26.0 billion, up 18% from Q4 and up 262% from a year ago.

Net Income

It had a net income of $14.8 billion, a growth of 21% over the previous quarter.

Operating Income

At $16.9 billion, Nvidia’s operating income, which is a profitability metric for its business segments.

Revenue From Primary Markets

The chip company serves five primary markets—data center, gaming, professional visualization, automotive, original equipment manufacturer (OEM) and other.

Its most noteworthy business results were derived from the first four markets:

• Data center revenue was a record $22.6 billion in the first quarter, up 23% from Q4 2024 and 427% YOY.
• Gaming revenue was $2.6 billion in the first quarter, down 8% from the previous quarter and up 18% YOY.
• Professional visualization revenue was $427 million in the first quarter, down 8% from Q4 and up 45% YOY.
• Automotive revenue was $329 million, an increase of 17% from Q4 and down 11% YOY.

Company Chief Executive Officer (CEO) Jensen Huang reported that “Accelerated computing and generative AI have hit the tipping point. Demand is surging worldwide across companies, industries and nations that demand for its AI solutions.”

Revenue From Business Segments

Nvidia reports business results for two business segments: Compute and Networking and Graphics.

Compute and Networking

According to Nvidia’s Form 10-K for the fiscal year 2024, the Compute and Networking segment is made up of:

• Data Center accelerated computing platforms and end-to-end networking platforms including Quantum for InfiniBand and Spectrum for Ethernet
• NVIDIA DRIVE automated-driving platform and automotive development agreements
• Jetson robotics and other embedded platforms
• NVIDIA AI Enterprise and other software
• DGX Cloud software and services

The Compute and Networking segment delivered revenue of $47.4 billion in FY 2024, up 215% from FY 2023. The segment accounted for almost 78% of Nvidia’s total revenue.

Operating income, at $32.01 billion, grew 530% YOY.

Graphics

Nvidia’s graphics segment is comprised of:

• The GeForce GPUs for gaming and PCs, the GeForce NOW game-streaming service and related infrastructure, and solutions for gaming platforms
• The Quadro/NVIDIA RTX GPUs for enterprise graphics design
• Virtual GPU (vGPU) for cloud-based visual and virtual computing
• automotive platforms for infotainment systems
• Omniverse Enterprise software for the construction and operation of metaverse and 3D internet apps

The Graphics segment delivered revenue of $13.51 billion in FY 2024, up 14% from FY 2023. The segment accounted for slightly over 22% of Nvidia’s total revenue.

Operating income, at $5.84 billion, grew 28% YOY.

Equity Holdings

Nvidia’s Form 13F includes the following equity holdings and associated values, as of December 31, 2023:

Company	Value
ARM HOLDINGS PLC	$147,343,114
NANO X IMAGING LTD	$379,856
RECURSION PHARMACEUTICALS INC	$75,984,739
SOUNDHOUND AI INC	$3,669,472
TUSIMPLE HLDGS INC	$3,041,904

Historic

On Thursday, February 22, 2024, Nvidia’s market capitalization jumped by $272 billion, the largest change ever seen in such value in a single day.

History and Leadership

Nvidia Corporation was founded in 1993 by Jensen Huang, Chris Malachowsky, and Curtis Priem. It is headquartered in Santa Clara, California.

Huang has led Nvidia as President, Chief Executive, and member of the Board of Directors. Before starting the company with Malachowsky and Priem, Huang worked at LSI Logic and Advanced Micro Devices.

Co-founder Malachowsky is a Nvidia senior technology executive who helped spearhead Nvidia’s growth from startup to accelerated computing standout. Prior to Nvidia, he worked at HP and Sun Microsystems. He is an expert in integrated-circuit design and methodology.

Co-founder Priem was Nvidia’s Chief Technology Officer for 10 years. He left Nvidia in the early 2000s.

Nvidia has more than 27,000 employees worldwide and more than 7,500 patents in force and pending.

Recent Developments

In early March 2024, Nvidia and HP Inc. announced their intention to integrate NVIDIA CUDA-X™ data processing libraries with HP AI workstation solutions. This will drive generative AI development through data preparation and processing work.

In November of 2023, Nvidia connected the world’s leading AI computing platform with its new NVIDIA HGX™ H200. The platform features the NVIDIA H200 Tensor Core GPU with advanced memory. It is designed to manage enormous amounts of data for generative AI as well as complex and demanding computing workloads.

In August 2023, Nvidia provided a major upgrade for its Omniverse platform. Omniverse is used with 3D tools and applications. The upgrade “accelerates the creation of virtual worlds and advanced workflows for industrial digitalization.”

ChatGPT, powered by the NVIDIA DGX™ AI supercomputer, launched in late November 2022. In two months, users numbered 100 million. It instantly became the fastest-growing app in history.

What Happened With Nvidia’s Intended Purchase of Arm?

In February 2022, Nvidia announced that it was terminating its agreement to purchase U.K.-based semiconductor design firm Arm from SoftBank Group Corp. due to significant regulatory challenges.

Is Nvidia Still a Graphics Company?

Due to the rise of AI and the enormous success of ChatGPT, powered by Nvidia’s AI supercomputer, CEO Jensen Huang, shifted Nvidia’s major focus from graphics to AI in late 2023.

How Much Does a Share of Nvidia Stock Go For?

On August 27, 2024, Nvidia shares were trading in the neighborhood of $128 per share.

The Bottom Line

Nvidia Corporation is a global technology company that was founded in 1993. It introduced the graphics processing unit (GPU) for accelerated computing tasks such as graphics rendering, gaming, and video editing.

In late 2023, its primary focus moved from graphics to artificial intelligence due to the massive success of ChatGPT, which is powered by Nvidia’s GPUs, and the resulting demand for its products.