Profit Margin Calculator.
Calculate gross, operating, and net profit margins to understand your business profitability at every level.
Understanding Profit Margins
Profit margins measure how effectively your business converts revenue into profit. Each margin type provides insight into a different layer of your cost structure.
Gross margin reflects the profitability of your core product or service after direct production costs (COGS). It reveals whether your pricing covers the cost of what you sell.
Operating margin factors in day-to-day business expenses -- salaries, rent, marketing, and utilities. It shows whether your operations are financially sustainable.
Net margin is your bottom line after all costs, including taxes and interest payments. It represents the actual percentage of revenue that becomes profit.
Markup differs from margin: it measures profit as a percentage of cost rather than revenue. A 50% margin equals a 100% markup.