Profit Margin Calculator

This profit margin calculator helps you see what you actually make after costs. Enter your revenue, expenses, or unit costs, and it shows your gross profit, operating profit, and net profit margin. It’s simple, clear, and works on any device that you may have. You can use it for one product, a single job, or your full business. The gross profit formula is revenue minus cost of goods sold. The profit margin formula is profit divided by revenue. Both are shown right above your results so you know how each number comes together. This calculator also includes markup and break-even details to help you see how much you need to sell to cover your costs. Every input updates instantly, and it works well on mobile. If you run a small business, sell products online, or just want to track your margins better, this tool gives you clean numbers that make sense anywhere in the world.

How to Use the Profit Margin Calculator

1. Enter your revenue.
   Type your total sales or income in the revenue box. This can be for one product, one job, or your total business revenue.
2. Add your cost of goods sold (COGS).
   Enter the total cost of producing or buying what you sold. This includes materials, labor, or product purchase costs.
3. Enter your operating expenses.
   Add all business expenses that are not part of COGS, such as salaries, rent, marketing, shipping, and utilities.
4. Include any other income or expenses.
   Add other income like investments or side earnings, and list other expenses such as interest or one-time costs.
5. Set your tax rate.
   Type your estimated or actual tax percentage so the calculator can show net profit after tax.
6. Choose your mode.
   Use “Totals mode” if you have overall numbers for a period. Use “Per-unit mode” if you want to calculate margins for each item you sell.
7. Click Calculate.
   The results will display your gross profit, operating profit, net profit, profit margins, markup, and EBITDA. Bars below show the margin percentages visually.
8. Optional: Check your break-even point.
   Enter your unit price, unit cost, and total fixed costs in the break-even section to see how many units you need to sell to cover your expenses.

Profit Margin Formulas

Gross Profit Formula
Gross Profit = Revenue − Cost of Goods Sold

Operating Profit Formula
Operating Profit = Gross Profit − Operating Expenses

Net Profit Formula
Net Profit = Operating Profit + Other Income − Other Expenses − Taxes

Profit Margin Formula
Profit Margin = (Profit ÷ Revenue) × 100

Markup Formula
Markup = (Profit ÷ Cost of Goods Sold) × 100

Break-even Point Formula
Break-even Units = Fixed Costs ÷ (Unit Price − Unit Variable Cost)

Real Examples of How You Can Use This Calculator

Let’s say you run a small shop that sells custom hoodies. Each hoodie sells for $80, and it costs you $45 to make after materials and printing. You sell 200 hoodies this month, which gives you $16,000 in revenue. Your total cost of goods sold (COGS) is $9,000.

Plug those numbers into the profit margin calculator:

• Revenue: 16,000
• COGS: 9,000
• Operating expenses (rent, ads, etc.): 3,000
• Tax rate: 20%

You will see your gross profit is $7,000, your operating profit is $4,000, and your net profit after tax is $3,200. The calculator also shows your gross margin of 43.75 percent, net margin of 20 percent, and markup of 77.7 percent. Those numbers tell you exactly how much you are keeping after costs and tax.

If you are a contractor in Alberta, this calculator works the same way. Say you made $12,000 last month and spent $4,000 on materials and fuel, plus $2,500 in operating costs. After a 25 percent tax rate, your net profit is $4,125. That means your net profit margin is about 34 percent, which is solid for small contracting work.

If you sell products online, like through Shopify or Etsy, the per-unit mode is useful. For example, each product sells for $40, costs $22 to make, and you spend $5,000 per month on ads and fees. The calculator shows you need to sell 278 units to break even and 300 units to start making a profit.

These examples show how the profit margin calculator gives you clear numbers you can use in real situations. You can use this calculator for any kind of work where you earn and spend money. It shows your gross profit, operating profit, net profit margin, markup, and break-even point in one view. The results update right after you enter your numbers, so you can see how each cost changes your final margin.

Frequently Asked Questions About the Profit Margin Calculator

What is a profit margin calculator?
A profit margin calculator is a simple tool that shows how much money your business keeps after covering its costs. It calculates gross profit, operating profit, and net profit margin based on your revenue, expenses, and tax rate. This helps you understand if your pricing is right and how much of your sales actually turn into profit.

How do I calculate profit margin?
The basic profit margin formula is profit divided by revenue, multiplied by 100. For example, if your profit is $2,000 and your revenue is $10,000, your profit margin is (2,000 ÷ 10,000) × 100 = 20 percent.

What is gross profit margin?
Gross profit margin measures how much of your revenue is left after paying for the cost of goods sold (COGS). The formula is gross profit divided by revenue. It shows how efficiently you produce or buy your products.

What is net profit margin?
Net profit margin is the percentage of revenue left after subtracting all costs, including operating expenses, interest, and taxes. It represents the actual profit your business keeps after every expense.

What is the difference between gross profit and operating profit?
Gross profit only subtracts the cost of goods sold from revenue. Operating profit goes further by subtracting all operating expenses such as rent, salaries, and marketing. This shows how much profit your business makes from its main operations.

How do I find markup using this calculator?
Markup is calculated as profit divided by the cost of goods sold, multiplied by 100. If your product costs $50 to make and sells for $75, your markup is (25 ÷ 50) × 100 = 50 percent. The calculator displays markup automatically along with profit margins.

Can I use this calculator for a single product?
Yes. Use the per-unit mode to calculate profit for one item. Enter your unit cost, unit price, and optional expenses. The calculator will show your margin, markup, and break-even point for that product.

What does the break-even result mean?
The break-even result shows how many units you need to sell to cover all your costs. It is calculated using the formula fixed costs divided by (unit price minus unit variable cost). This helps you plan sales targets and pricing.

Can this calculator handle taxes automatically?
Yes. You can enter a tax percentage, and the calculator will estimate your net profit after taxes. This feature helps small business owners and contractors see their real take-home profit.

Is the profit margin calculator accurate for all businesses?
Yes, as long as you enter real numbers for your costs, expenses, and revenue. It works for any business type, including retail, service, construction, e-commerce, or manufacturing.

Can I use this calculator on mobile?
Yes. The profit margin calculator is mobile-friendly. It adjusts automatically to fit any screen size, so you can check your margins on your phone or tablet while working or traveling.

Why is profit margin important?
Profit margin shows how efficiently your business turns sales into profit. It helps you find out if your pricing is too low, if your costs are too high, or if your operations are healthy. It’s one of the key financial metrics used by accountants, investors, and business owners to measure success.

Final Example and Wrap-Up

Take someone like myself, running a few online tools and side projects. Let’s say one of those tools brings in $2,000 a month in revenue. Hosting, ads, and other costs add up to $800. Using this calculator, the gross profit shows $1,200, and after a 20 percent tax rate (wishful thinking), the net profit comes to $960. That means a 48 percent net profit margin, which is solid for a small online project.

The same logic works if you’re running a local business, reselling gear, or doing contract work. Type in your real numbers, and you’ll see how much you’re keeping and where the rest is going. This profit margin calculator gives you the facts without guessing, and once you understand the numbers, every decision gets easier.