The more you make, the less you earn?

In some business valuations, we’ve seen companies where profits shrink as revenue grows. Sounds strange, right? But it happens.

Why? Because the cost of expansion can outweigh the extra margin. For example, a company may need to take on heavy overhead costs to boost production—but if sales volume isn’t high enough, those costs eat up the profits.

That’s why, in certain forecasts, you’ll see profitability dip before rising again—once the company reaches the scale needed to cover those extra costs.

Sometimes, not expanding can actually be the smarter move.

👉 At ORNA, we help businesses see the real story behind the numbers—not just revenue growth, but the value that truly matters.

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