Profit Margin Calculator
Compute gross profit and gross margin from your revenue and cost of goods sold. Enter the two numbers and instantly see profit in absolute terms and as a percentage of revenue — plus the markup on cost for comparison.
How to use
- 1
Enter revenue
Type the total selling price — what your customer pays you for the product or service.
- 2
Enter cost of goods sold
Enter only the direct costs of producing or buying the goods. Exclude overheads, salaries and rent — this is gross margin, not net margin.
- 3
Read the result
Gross profit, gross margin % and markup on cost update instantly. A loss warning appears if cost exceeds revenue.
- 4
Copy the breakdown
Click Copy to put the full summary on your clipboard for your notes or your business plan.
Common use cases
- Set a profitable price for a new product by modelling the required margin.
- Compare the profitability of two SKUs with different cost structures.
- Audit a quarter's gross margin by feeding in revenue and COGS totals.
- Communicate pricing rationale to a co-founder using margin + markup side by side.
Limitations
- This calculator produces an estimate only and is not professional financial, tax or investment advice. Always confirm the underlying formulae with your accountant, bank or financial advisor before making decisions.
- This is gross margin — it excludes operating expenses, depreciation, interest and tax. Use a full P&L for net profitability.
- Cost of goods sold should include only direct production costs.
Frequently asked questions
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