How is profit margin calculated?
Subtract cost from revenue, divide by revenue, and multiply by 100.
Turn revenue and cost into dollar profit and a clear profit margin percentage.
Provide total revenue (sales) and total cost for the same period.
How to use Profit Margin Calculator, plus the formulas and logic behind the results.
Profit margin shows what share of revenue remains after costs. It is a common KPI for businesses and product lines.
Profit = revenue − costProfit margin % = profit ÷ revenue × 100Margin benchmarks (illustrative)
Subtract cost from revenue for profit, then divide by revenue for margin. Zero revenue is rejected for margin calculation.
Define cost consistently (COGS only vs fully loaded). This page does not allocate taxes, depreciation, or one-time items.
Common questions about the calculation and how to interpret the estimate.
Subtract cost from revenue, divide by revenue, and multiply by 100.
Match your analysis: COGS for gross margin, or broader operating costs for a net-style estimate.
Margin is undefined when revenue is zero; enter a positive revenue figure.
No. Margin is based on revenue; markup is based on cost—see the Margin Calculator.
Yes, as long as revenue and cost cover the same period.
Yes—free online calculator with guide and FAQ on this page.