Profit Margin Calculator
Calculate your gross and net profit margins to understand your business profitability. Enter your revenue, costs, and expenses to see your margins, net profit, and markup percentage.
Profit margin is the percentage of revenue that remains as profit after deducting costs. There are two primary types: gross profit margin and net profit margin.
Gross profit margin = (Revenue - Cost of Goods Sold) / Revenue x 100. This measures how efficiently you produce or source your products. A 40% gross margin means $0.40 of every dollar sold is gross profit.
Net profit margin = (Revenue - All Costs) / Revenue x 100. This accounts for all expenses including operating costs, overhead, and taxes. It shows the true bottom-line profitability of the business. The difference between gross and net margin reveals how much of your gross profit is consumed by overhead and operating expenses.