![]() market, its share is on the lower end in terms of global vehicle sales. While Tesla is a market leader in the electric vehicles ( EV) market by a substantial margin, especially in the U.S. Suppose we’re tasked with calculating the market share of Tesla (NASDAQ: TSLA) in the global automotive market. The formula to calculate the relative market share is as follows. ![]() To estimate the relative market share, we take the market share of the company in question and then divide it by the market share of its top competitor. constant percentage – can also be a positive signal, particularly in a high-growth market.Īnother closely related metric, the “relative market share,” is calculated by dividing a company’s market share by the market share belonging to its top competitor. While market share growth is perceived favorably by practically all equity analysts and market participants, the retention of the prior market share – i.e. The most straightforward method to analyze a company’s market share is to calculate the percentage of the market captured by a given company and determine if the company is positioned as a market leader with a substantial percentage of the market.įurther, tracking the historical trajectory in the company’s market share is useful for gauging its growth trends. Note that it is critical that the time frame covered must match in the numerator and denominator for the metric to be practical.
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