Margins, break-even & unit economics · Core
Margin compression
Also called: margin decline
ELI5
Decrease in a selected margin percentage.
Used in conversation
“Keep margin compression on the dashboard, but show the definition and reporting period beside it.”
Pitch context
You will see “Margin compression” in financial models, budgets, board packs and investor materials when the discussion reaches margins, break-even & unit economics.
Why it matters: In margins, break-even & unit economics, different calculation boundaries, periods or accounting treatments can change the number and the decision.
Caution
Calculation, recognition and disclosure can vary by accounting framework, company policy and reporting context.
Sources & evidence · 4
Direct term-level sources and supporting source families.
- U.S. Small Business Administration — Break-even pointDirect source · primary · checked 2026-08-16
- IFRS Foundation — IFRS GlossaryDirect source · primary · checked 2026-08-16
- Financial Accounting Standards Board — FASB Accounting Standards CodificationSupporting source family · primary · checked 2026-08-16
- U.S. Securities and Exchange Commission — Non-GAAP Financial Measures — Compliance and Disclosure InterpretationsSupporting source family · primary · checked 2026-08-16