Revenue Passenger Miles (RPM): What It Measures and Why Airlines Use It
Warren Team
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Key terms
- RevenueThe total amount of money a business earns from selling its products or services before any expenses, taxes, or costs are deducted. Revenue is often referred to as the 'top line' because it appears at the top of the income statement. While revenue growth is important, it does not necessarily indicate profitability since a company can have high revenue but still operate at a loss if expenses exceed income.
- Travel MilesAirline or hotel loyalty points earned through credit card spending. Typically 1-3 miles per dollar spent, with bonus miles on travel purchases. Can be redeemed for flights, hotels, or upgrades.
- Room and BoardThe combined cost of housing and meal plans at a college or university, which is a significant portion of the overall cost of attendance. Room and board costs vary depending on whether you live on campus, off campus, or at home, and the type of meal plan you select. Many colleges require first-year students to live on campus and purchase a meal plan.
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