Profit Margin Calculator
Find profit margin, gross profit or markup from revenue (selling price) and cost. Enter totals for a business or the price and cost of a single item.
Last updated: October 2026
Result
30 %
Formula below · 3 sources (sec.gov, investor.gov, investopedia.com) · Updated Oct 2026
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About this calculator
Profit margin is the share of each dollar of revenue that is left after costs:
Margin = (Revenue − Cost) ÷ Revenue × 100
Markup measures the same profit against cost instead of revenue:
Markup = (Revenue − Cost) ÷ Cost × 100
With revenue of $100,000 and costs of $70,000, profit is $30,000, the margin is 30% and the markup is 42.86%. Margin can never reach 100%; markup can be any size. Confusing the two is a common pricing mistake: a 50% markup is only a 33.3% margin.
Which margin?
The result depends on which costs you enter. Cost of goods sold alone gives gross margin, which shows pricing power over direct costs. Adding operating expenses gives operating margin; adding interest and taxes as well gives net margin, the bottom line. Compare margins of the same type, for the same period, and within the same industry: grocers run thin net margins on high volume, while software firms keep most of each sale.
| Profit margin | Equivalent markup | Price for a $100 cost |
|---|---|---|
| 10% | 11.1% | $111.11 |
| 20% | 25% | $125.00 |
| 25% | 33.3% | $133.33 |
| 30% | 42.9% | $142.86 |
| 40% | 66.7% | $166.67 |
| 50% | 100% | $200.00 |
How to use
Enter revenue (or one item's selling price) and the matching cost, then choose margin, profit or markup. The default, $100,000 revenue and $70,000 cost, gives a 30% margin, $30,000 profit or a 42.86% markup. For one product that sells for $25 and costs $15: margin = 10 ÷ 25 = 40%, markup = 10 ÷ 15 = 66.67%. To hit a target margin, price = cost ÷ (1 − margin): a $15 item at a 40% margin sells for $25.
Frequently asked questions
What is the difference between margin and markup?
Both use the same profit, but margin divides it by revenue and markup divides it by cost. An item that costs $60 and sells for $100 has a 40% margin and a 66.7% markup. Markup is always the larger number when there is a profit.
What are gross, operating and net margin?
Gross margin subtracts only the cost of goods sold. Operating margin also subtracts operating expenses such as rent, salaries and marketing. Net margin subtracts everything, including interest and taxes. Each layer is lower than the one before.
How do I price for a target margin?
Divide cost by (1 − target margin). For a 30% margin on a $70 cost: 70 ÷ 0.7 = $100. Adding 30% to cost ($91) gives only a 23% margin.
What is a good profit margin?
It depends on the industry. Grocery and other high-volume retail often run net margins of a few percent, while software and some branded goods keep much more. Compare with businesses like yours and with your own past results rather than a single benchmark.
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