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Profit Margin Calculator

Calculate profit and profit margin from revenue and cost. See the dollar profit, margin percentage and the formula behind the result.

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Profit margin Live result

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Calculation breakdown

How to read this result

Use the result to compare scenarios and verify the inputs, units and real-world conditions before making an important decision.

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How to use it

A clear result in a few inputs.

Enter the requested values.Use consistent units and the real values for your scenario.
Read the main result and breakdown.NumLuma recalculates immediately when an input changes.
Check the formula and assumptions.Use the supporting context before making a real-world decision.

What this calculator does

Profit margin answers a specific question: what percentage of revenue remains after the cost included in the calculation? The denominator is revenue, which is why margin is not the same as markup. NumLuma shows both the dollar profit and the margin percentage so you can see the relationship directly.

What to know before you use the result

Profit = revenue − cost.
Margin = profit ÷ revenue, not profit ÷ cost.
Your definition of cost determines whether the result is gross, operating or another type of margin.

Common mistakes to avoid

Calling markup and margin the same percentage.
Comparing margins that use different definitions of cost.
Using revenue before returns or discounts in one period and net revenue in another.

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Decision depth

Change one lever. See what moves.

These are reusable starting points, not recommendations. Open a scenario, then change the inputs to match your own case.

01 / SCENARIO

35% current margin

Start with $1,000 revenue and $650 cost.

Open scenario ↗02 / SCENARIO

Lower-cost case

Keep revenue at $1,000 and reduce cost to $600.

Open scenario ↗03 / SCENARIO

Higher-revenue case

Keep $650 of cost and test $1,150 of revenue.

Open scenario ↗

Formula reference

Profit Margin Formula

Profit = revenue − cost; margin % = (profit ÷ revenue) × 100

Learn the profit margin formula, the difference between profit and margin, and how revenue and cost affect the result.

Understand the formula →

Assumptions & scope

Know what the number includes.

Commercial business intent. Define the metric precisely and distinguish it from neighboring metrics to avoid thin or interchangeable pages.

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Decision answers

Questions connected to this calculator.

Use a worked question when you want context before changing the inputs yourself.

What profit margin should I charge?↗

Learn the concept

Profit Margin vs. Markup

Understand the difference between margin and markup, why they are not interchangeable, and how each is calculated.

Read guide →

Quick answers

About the profit margin calculation.

What is the difference between profit and profit margin?

Profit is a currency amount. Profit margin expresses that profit as a percentage of revenue.

Is margin the same as markup?

No. Margin divides profit by revenue, while markup divides profit by cost. The percentages differ even when cost and selling price are identical.

Can profit margin be negative?

Yes. If the included cost is greater than revenue, profit and the resulting margin are negative.

Which costs should I enter?

Use the cost definition that matches the metric you want. For gross margin, that is typically cost of goods sold; for broader profitability, additional expenses may need to be included.