CalcKit

Profit Margin Calculator

Find your gross profit and the share of revenue you keep.

Enter your values

Total sales before subtracting costs.

Cost of goods or services sold.

Result

Profit margin25.00%
Revenue
$10,000.00
Cost
$7,500.00
Gross profit
$2,500.00

You keep $25.00 in gross profit for every $100 of revenue. A negative margin means costs exceed revenue.

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Formula

Profit margin (%) = (Revenue − Cost) ÷ Revenue × 100

Worked example

A business earns $10,000 in revenue and spends $7,500 on goods sold.

Gross profit is $2,500. The profit margin is 25.00%.

How to use

  1. Enter revenue for one consistent period.
  2. Enter the cost associated with those sales.
  3. Calculate to see gross profit and margin; include overhead in cost if you want an operating margin estimate.

Related calculators

MarkupCalculate how much your selling price adds to your cost.Break-EvenFind how many units you need to sell to cover your costs.ROIMeasure your net gain as a percentage of your investment.

Frequently asked questions

How is margin different from markup?

Margin divides profit by selling price or revenue. Markup divides profit by cost. A $100 sale with an $80 cost has a 20% margin and a 25% markup.

Can profit margin be negative?

Yes. If your costs exceed revenue, gross profit and margin are negative. Zero revenue has no defined margin.

What costs should I include?

For gross margin, include the direct cost of goods or services sold. For an operating margin estimate, also include relevant operating expenses. Use the same period for both inputs.