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Business calculator

Profit Margin Calculator

This calculator subtracts entered cost from revenue, then expresses that profit as a percentage of revenue.

Updated · Inputs stay in your browser

Educational estimate: This result is not financial, tax, legal, or investment advice. Check real terms and consider qualified advice for important decisions.

Enter your values

Choose the symbol used to display amounts.
Sales or income for the period.
Costs included in this margin.

Your values stay on this device. Nothing is sent to Calculate & Decide unless you deliberately use your device's share feature.

What this result means

This calculator subtracts entered cost from revenue, then expresses that profit as a percentage of revenue. The results panel explains the main number and the quantities that produced it, so you can check whether the estimate answers your real question.

Formula used

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

Step-by-step calculation

  1. Validate every required value and reject values outside the stated field limits.
  2. Convert rates and time periods to the units required by the formula.
  3. Calculate with full JavaScript number precision; do not round intermediate values.
  4. Round only the displayed result and explain the practical meaning.

Worked example

Revenue of $8,000 and cost of $5,200 produce $2,800 gross profit and a 35% margin.

Assumptions and limitations

  • Cost includes every cost you intend this margin to measure.
  • Revenue and cost cover the same period or units.
  • The result is gross or net margin only according to the costs you enter.

How to use this calculator

  1. Choose a currency symbol when the tool uses money.
  2. Enter values in the units shown beside each field.
  3. Select Calculate, then read both the main result and interpretation.
  4. Change one uncertain input at a time to understand sensitivity.
  5. Use Copy result or Share only when you choose to move the result outside this page.

Common mistakes

  • Dividing profit by cost, which calculates markup instead.
  • Mixing tax-inclusive revenue with tax-exclusive cost.
  • Comparing businesses that classify costs differently.

Frequently asked questions

How is margin different from markup?

Margin divides profit by revenue; markup divides profit by cost.

Can margin be negative?

Yes. Cost above revenue produces a negative margin.

Is this automatically net profit margin?

Only if the cost input includes all expenses relevant to net profit.

Methodology and sources

Formula definitions and edge-case behavior are documented on our Methodology page. No external data is fetched by this calculator.

See the site-wide calculation methodology and editorial standards. Formula errors can be reported through the error-reporting instructions.

Published and reviewed .