What Are Selling, General, and Administrative (SG&A) Expenses?

By Catherine Brock – Updated Jun 11, 2025 at 12:16 AM

Key Points

SG&A expenses include non-manufacturing costs like rent and salaries for support staff.
Reducing SG&A expenses can effectively lower overall business spending.
Walmart and Visa use different methods to report their SG&A on income statements.

Selling, general, and administrative (SG&A) expenses commonly appear on income statements, either as a category of expenses or a single line item. Let's explore SG&A expenses in more detail and the role they play in business operations.

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Person sitting at computer while reviewing financial statements. — Image source: Getty Images.

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SG&A expenses appear on the income statement below gross profit and above operating profit. While SG&A expenses are often synonymous with operating expenses, some companies may report one, the other, or both. Generally, gross profit less SG&A expenses and any other operating expenses equals operating profit.

The income statement may deduct additional expenses from operating profit to calculate net income. These are non-operating expenses such as interest, taxes, and extraordinary gains or losses.

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About the Author

Catherine grew up in Southern California wearing a lot of black and trying to perfect the art of sarcasm. Prior to joining The Fool as a contract writer, Catherine was climbing the corporate ladder in marketing roles and dabbling in too many side hustles. When she's not writing, she can be found riding a horse in the country or shopping online for clothes.

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Catherine Brock has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Visa and Walmart. The Motley Fool has a disclosure policy.