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Profit Margin Calculator

Last updated: July 2026

Calculate gross profit, margin, and markup.

Profit margin

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  • Gross profit: —
  • Markup on cost: —
On this page

Quick summary: Calculate gross profit, margin, and markup. Enter the requested values, calculate, review the result, and compare more than one realistic scenario before making a decision.

Reviewed July 22, 2026 • Estimated reading time: 6 minutes
Read the complete guide

What this calculator does

The Profit Margin Calculator measures profit relative to revenue and can help compare pricing or business performance across products with different selling prices.

How to use the calculator step by step

Enter revenue or selling price and the relevant cost values. Make sure the costs included match the type of margin you intend to calculate, such as gross margin versus a broader net margin.

How the calculation works

Profit equals revenue minus cost. Profit margin percentage equals profit ÷ revenue × 100. If an item sells for 125 and costs 100, profit is 25 and margin is 20%.

Worked example and scenario testing

A product sells for 80 and has a direct cost of 52. The profit is 28 and the margin is 28 ÷ 80 × 100 = 35%. Notice that markup on the 52 cost would be about 53.8%, which is a different measure.

How to interpret your result

A higher margin means a larger share of each revenue unit remains after the included costs. The meaning depends on which costs are included, so margins from different accounting definitions should not be compared blindly.

Accuracy, assumptions, and limitations

The calculator may not include overhead, financing, taxes, returns, discounts, payment fees, depreciation, or other expenses unless you enter them.

Common mistakes to avoid

The most common error is confusing margin with markup. Margin divides profit by revenue, while markup divides profit by cost.

Privacy and browser-based calculations

Only business amounts are needed. Avoid entering customer details, account numbers, or confidential identifiers.

Frequently asked questions