Profit Margin Calculator
Calculate gross, operating, and net profit margins from your revenue data.
Inputs
$
$
$
$
Results
Net Profit
$15,000.00
15.00% net margin
Gross Profit
$40,000.00
40.00%
Operating Profit
$20,000.00
20.00%
Formula
Gross Margin = (Revenue - COGS) / Revenue × 100\nOperating Margin = (Gross Profit - OpEx) / Revenue × 100\nNet Margin = Net Profit / Revenue × 100
Each margin level shows profitability at different stages: after production costs (gross), after operating costs (operating), and after all expenses (net).
Worked Example
Revenue: $100,000 | COGS: $60,000 | OpEx: $20,000 | Other: $5,000
Gross Profit: $40,000 (40% margin)
Operating Profit: $20,000 (20% margin)
Net Profit: $15,000 (15% margin)
When to Use This Calculator
Use to analyze business profitability at different levels. Compare margins across periods or against industry benchmarks.
Important Assumptions
- Figures represent a single period.
- All expenses are accounted for in the respective categories.
Common Mistakes to Avoid
- Confusing markup with margin — they are different calculations.
- Comparing margins across industries without context.
Frequently Asked Questions
What is a good profit margin?
It varies by industry. Software companies may have 20-40% net margins, while retailers might have 2-5%. Compare against your specific industry benchmarks.
What is the difference between gross and net margin?
Gross margin only deducts production costs (COGS). Net margin deducts all expenses including operations, overhead, and other costs.
Related Calculators
Methodology: This calculator uses standard financial formulas documented above. All calculation engines are unit-tested for accuracy.View full methodology
Disclaimer: This calculator provides estimates for educational purposes only. Results do not constitute financial advice.Full disclaimer