Operating margin is a financial metric that measures the percentage of revenue that remains after covering operating expenses, such as wages, rent, and utilities. It is calculated by dividing operating income by total revenue. A higher operating margin indicates a company is more efficient at converting sales into profit, which can be a sign of good management and cost control. Investors often use operating margin to assess a company's profitability and operational efficiency compared to its peers in the same industry. Companies with consistent and high operating margins, like Apple or Microsoft, are generally viewed as financially healthy and capable of sustaining growth over time.