Calculate your profit margin in real time.
Select Gross or Net Margin, enter your numbers, and see instant results!
Gross Margin excludes overhead and tax. Net Margin includes them. You will see the difference in the “Total Cost” portion of the chart.
How to Use
Select “Gross” or “Net” Margin:
Gross Margin ignores overheads and tax.
Net Margin adds overheads and tax to the total cost, showing your bottom-line profitability.
Enter Your Figures:
Total Cost: The sum of all production or service costs.
Total Revenue: The total amount earned from sales or services.
Additional Overheads: If calculating net margin, include any overhead expenses not already in “Total Cost”.
Tax Rate on Revenue: If calculating net margin, enter the percentage of revenue that goes to taxes.
Review Results:
The calculator instantly shows your Profit (in $) and Margin (as a percentage).
A donut chart compares total cost to profit for quick visualization.
What Formulas Does The Calculator Use?
Gross Margin Formulas:
\(\text{Profit} = \text{Revenue} – \text{Cost}\)
\(\text{Margin (%)} = \left(\frac{\text{Profit}}{\text{Revenue}}\right)\times 100\)
Net Margin Formulas:
\(\text{Adjusted Revenue} = \text{Revenue} \times \Bigl(1 – \frac{\text{Tax Rate}}{100}\Bigr)\)
\(\text{Total Cost} = \text{Cost} + \text{Overheads}\)
\(\text{Profit} = \text{Adjusted Revenue} – \text{Total Cost}\)
\(\text{Margin (%)} = \left(\frac{\text{Profit}}{\text{Revenue}}\right)\times 100\)
FAQ
What is Profit Margin?
Profit margin is a percentage that tells you how much profit you make relative to your revenue. A higher margin means that you have a more profitable operation.
Can I include additional expenses as Overheads?
Yes, if you want to calculate Net Margin. Some examples of overhead expenses include extra shipping, marketing, or administrative costs.
Why does the profit margin sometimes appear negative?
If your costs exceed revenue, or taxes + overhead are very high, you’ll see a negative profit, which means you’re operating at a loss.
You may be interested in our Break-Even Calculator