retained earnings

Retained earnings refer to the cumulative profit a company has kept over time, rather than paid out as dividends to shareholders. They represent the portion of net income reinvested into the business to fund growth, pay down debt, or improve operations. Think of it as the company's savings account from past profits, which helps support future development and stability. Retained earnings are reported on the company's financial statements and show how much profit has been retained for ongoing use rather than distributed to owners.