Learn · Explainer
Noncontrolling interest
The share of a subsidiary the parent doesn't own: how earnings and equity are split, with P&G's and Coca-Cola's 10-Ks.
The short answer
A noncontrolling interest, sometimes called a minority interest, is the share of a subsidiary that the parent company doesn't own. Because the parent consolidates 100% of the subsidiary, it has to subtract the outside owners' share of earnings before it arrives at net income attributable to its own shareholders. Earnings per share uses that second figure.
Why the income statement splits
If a company owns 80% of a subsidiary, it still includes 100% of that subsidiary's revenue and expenses in its consolidated income statement. The 20% that belongs to the other owners is then deducted on a line usually labeled "net earnings attributable to noncontrolling interests." What remains is net earnings attributable to the parent, the figure used for earnings per share.
Procter & Gamble's 10-K for fiscal 2026 shows the split plainly: net earnings, then "Less: Net earnings attributable to noncontrolling interests," then "NET EARNINGS ATTRIBUTABLE TO PROCTER & GAMBLE." A footnote states that diluted net earnings per common share are calculated on net earnings attributable to Procter & Gamble, not on the larger consolidated net earnings figure.
Source: Procter & Gamble 10-K for fiscal 2026, filed Aug 4, 2026
On the balance sheet
The same outside ownership appears in equity, not as a liability. Coca-Cola's 10-K for 2025 reports equity attributable to shareowners of The Coca-Cola Company and, separately, "Equity attributable to noncontrolling interests," which together equal total equity. The outside owners have a claim on the net assets of the subsidiary, so that claim sits in the equity section.
Source: Coca-Cola 10-K for fiscal 2025, filed Feb 20, 2026
What to watch
- Which profit figure is being compared. Operating income and consolidated net earnings include the whole subsidiary. EPS and net earnings attributable to the parent do not.
- The statement of comprehensive income often has the same split, as Coca-Cola's does, because currency translation and similar items also belong partly to the outside owners.
- Redeemable noncontrolling interests, when they appear, may be classified between liabilities and equity if the outside owners can require the parent to buy them out.
Common questions
What is a noncontrolling interest?
The portion of a consolidated subsidiary that the parent does not own. It is also called a minority interest.
Why is it subtracted from net earnings?
The parent consolidates 100% of the subsidiary, so it must take out the share of profit that belongs to the other owners before it reports earnings for its own shareholders.
Which figure is used for EPS?
Net earnings attributable to the parent. P&G's 10-K states that diluted earnings per common share are calculated on net earnings attributable to Procter & Gamble.
Is a noncontrolling interest a debt?
No. It is equity of the subsidiary's other owners. It appears in the equity section of the balance sheet, unless a redemption feature requires a different presentation.
Where do I find it?
On the income statement, just above net earnings attributable to the parent, and on the balance sheet in equity. The statement of comprehensive income often has a matching line.
Disclosures
- Editor holdings
- The editor holds no position in any company named on this page. As of Nov 11, 2026.
- Compensation
- Nobody paid for this page. No affiliate links on this page.
- Sources
- Each company's own SEC filings, linked next to each number.
- Last updated
- Nov 10, 2026
General education, the same for every reader. Not a recommendation to buy, sell or hold any security, and it doesn't consider your situation.
More in Learn and Tools · Methodology & Disclosures explains where every number comes from.