Finance calculator
Profit Margin Calculator
Use this profit margin calculator to understand the difference between profit margin and markup. Both use revenue and cost, but they answer different business questions.
Formula
- Gross profit = revenue - cost
- Profit margin = gross profit / revenue x 100
- Markup = gross profit / cost x 100
Example calculation
If revenue is $10,000 and cost is $6,500, gross profit is $3,500. Profit margin is 35%, while markup is about 53.85%.
FAQ
What is the difference between margin and markup?
Margin compares profit to revenue. Markup compares profit to cost. They are related, but they are not the same percentage.
Does this calculate net margin?
No. It calculates gross profit from one revenue and cost input. Net margin would usually include operating expenses, taxes, interest, and other costs.
Can margin be negative?
Yes. If cost is greater than revenue, gross profit and margin are negative.
Educational disclaimer
MoneyHackWise calculators are for educational purposes only and do not provide financial, investment, tax, legal, accounting, lending, or business advice. Results are estimates based on the inputs and assumptions shown.