Profit Margin Calculator
See what share of your revenue remains after costs. A negative margin means a loss.
How to calculate profit margin
Margin = (revenue − costs) ÷ revenue × 100. For example, $10,000 in revenue minus $7,000 in costs gives a 30% margin. If costs exceed revenue, the result is a loss. Include every relevant cost in the costs field. Taxes are not added automatically.
What a profit margin actually tells you
Profit margin is the percentage of revenue left after the costs you include. It helps you compare businesses or pricing options of different sizes. A dollar profit alone does not show how much of every sales dollar you keep.
For example, with $10,000 revenue and $7,000 costs, profit is $3,000 and margin is 30%. If the same revenue comes with $12,000 costs, profit is −$2,000 and margin is −20%: the business loses 20 cents for each dollar of sales.
Gross margin or net margin?
The formula is the same, but the costs you enter determine what the result represents. For gross margin, include the direct cost of goods or services sold. For a broader operating or net margin estimate, include the additional operating expenses that belong in the calculation. Taxes and interest are not added by this calculator automatically, so it cannot label the result “net margin” unless you have entered all relevant costs yourself.
Profit margin versus markup
Margin is profit divided by selling price or revenue. Markup is profit divided by cost. A $40 product sold for $60 has $20 profit, a 33.33% margin and a 50% markup. Use the markup and selling price calculator when setting a price from product cost.
Frequently asked questions
Do I need an account?
No. There is no registration, payment, or data upload. Calculations run in your browser.
Are taxes included?
No. Add any relevant taxes to your costs if you want them reflected in the estimate.
Related calculators
Compare margin with markup, or find the sales needed to cover your costs.