Unpacking the relationship between sales growth and profitability
Abstract
In a study of 1,591 high-technology firms operating in Russia over the course of 2013-2017, we investigate the relationship between two alternative performance indicators, sales growth and profitability, that have demonstrated an inconsistent relationship in prior research. We demonstrate that the relationship between these indicators follows an inverted U-shaped curve and is moderated by firm size, age, financial leverage, and asset turnover. Specifically, small firms, mature firms, firms that borrow less, and firms with higher asset turnover are advantageously positioned to turn sales growth into profitability.
Fields of Study & Subjects
Firm Innovation and Growth
Economic Growth and Productivity
Working Capital and Financial Performance
Publication details
- Journal / source
- Strategic Business Research
- Publisher
- Elsevier BV
- Volume
- 2
- Issue
- 1
- Pages
- 100101–100101
- Publication date
- 1 March 2026
- Language
- EN