Free Profit Margin Calculator - Analyze Your Profitability
Calculate your profit margins and analyze your business profitability
Formula & Methodology
Profit margin analysis helps determine how effectively a company is managing its costs and generating pure profit from its revenue streams.
- Gross Profit = Revenue - COGS
- Gross Margin % = (Gross Profit / Revenue) × 100
- Net Profit = Gross Profit - Operating Expenses
- Net Margin % = (Net Profit / Revenue) × 100
Worked Example
Using the Profit Margin Calculator: apply the formula above to your input values. For instance, Gross Profit = Revenue - COGS, then Gross Margin % = (Gross Profit / Revenue) × 100. The tool performs each step instantly and shows the result.
Frequently Asked Questions
What is the difference between profit margin and markup?
Margin is profit as a percentage of the selling price, while markup is profit as a percentage of the cost.
What is a good profit margin?
It varies widely by industry — retail may run thin single digits while software can exceed 70% — so compare within your sector.
What is the difference between gross and net margin?
Gross margin covers only cost of goods sold, while net margin subtracts all expenses including overhead and taxes.