Get to know CTO CORE

CORE stands for COGS, OPEX, Revenue and Earnings.

These are the 4 numbers your CEO and CFO run the company on. Learn them and you'll follow the budget conversation instead of waiting for someone to translate it.

COGS

Cost of Goods Sold. What it costs to deliver your product to paying customers: cloud, the third-party services inside your product, support, and the people running production. Lower COGS means a higher gross margin, and your board watches gross margin closely.

OPEX

Operating Expenses. What it costs to run the company: R&D, sales and marketing, office space and admin.

Engineering lands on both sides. Building the product is R&D, which is OPEX (or capitalized as software). Running production is COGS. That's on-call, SRE, keeping the live service up. It depends on what the work does, not on anyone's job title.

Revenue

What you've earned from customers by delivering the product in the period. Accountants call it recognized revenue. It's not what you billed and it's not what you collected. For SaaS that means subscriptions, licenses, usage charges and services.

Earnings

Net income. What's left after COGS, OPEX, interest and taxes. Positive means you're profitable. Negative means you're spending more than you bring in, and someone is going to ask about it.

Why should a CTO care?

Because your decisions are all over these numbers.

Cloud architecture, licensing and how big your team is all show up in COGS and OPEX. A slow, expensive system drags down gross margin every month it runs.

And when you ask for budget, this is the language the answer comes back in. Show how the work moves revenue or costs and you get a very different conversation.