How to use this profit margin calculator
Profit margin tells you what percentage of revenue remains after the cost used in the calculation is deducted. This calculator is useful for pricing checks and quick business estimates.
It is a general calculation tool, not accounting or tax advice. Use your actual accounting definitions when preparing official financial statements.
Formula
Profit = Revenue − Cost; Profit margin % = (Profit ÷ Revenue) × 100
Worked example
If revenue is 10,000 and cost is 7,000, profit is 3,000 and profit margin is 30%.
Step-by-step
- Enter total revenue.
- Enter the related cost.
- Calculate to see profit and margin percentage.
Frequently asked questions
What is the difference between margin and markup?
Margin measures profit as a percentage of selling price or revenue. Markup measures profit as a percentage of cost.
Can profit margin be negative?
Yes. If cost is greater than revenue, the profit and margin are negative.
Does this include tax and overhead?
Only if you include those amounts in the cost value you enter.
General-information note: This tool provides a mathematical estimate only. It does not provide financial, tax, lending, payroll, or accounting advice.