lost profits

Lost profits refer to the income a business could have earned but didn't, typically due to an event or action, such as a breach of contract, theft, or a natural disaster. It's an estimate of potential earnings that were missed, often calculated by comparing actual sales to expected sales under normal circumstances. For example, if a store closes for repairs and misses sales opportunities during that time, the revenue that would have been generated is considered lost profits. Understanding lost profits helps businesses estimate financial impacts and seek compensation when they've suffered damages.