OpEx
Business & Finance abbreviation · Finance
| Stands for | Operating expenditure |
|---|---|
| Categories | Business & Finance |
OpEx stands for Operating expenditure, a finance abbreviation.
Ongoing costs of running a business day to day, such as salaries, rent, utilities, marketing and software subscriptions, which are expensed in the period they are incurred. OpEx reduces operating profit immediately, unlike capital expenditure, which is spread over time through depreciation.
Example: Moving to cloud servers shifted about $5 million a year from CapEx to OpEx.
Usage notes
Also written opex or OPEX. The choice between buying assets and paying for services affects reported earnings, cash flow timing and taxes, which is why leasing and subscription offerings are sometimes marketed as "OpEx-friendly." In income statements, OpEx usually means operating expenses excluding cost of goods sold.
Related abbreviations
More finance abbreviations
- NOPAT – Net operating profit after tax
- NPV – Net present value
- NTM – Next twelve months
- NWC – Net working capital
- OCF – Operating cash flow
- OpCo – Operating company
- PE – Private equity
- PI – Profitability index
- PIK – Payment in kind
- PIPE – Private investment in public equity
- PV – Present value
- QoE – Quality of earnings