Finance tool

Profit CalculatorProfit Amount · Margin · Markup

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Step-by-step breakdown

This free profit calculator computes your profit amount, profit percentage, and profit margin from revenue and cost in seconds. Use it to evaluate product pricing, verify margins, or understand the profitability of any transaction.

All calculations use standard published formulas. Results are for informational use only.

Profit details

Calculation mode

Revenue / selling price ($)

Cost / COGS ($)

With revenue of $5,000.00 and a cost of $3,500.00, your profit is $1,500.00.

Gross Profit

$1,500.00

on $5,000.00 revenue

42.86%

Profit % (Markup)

30%

Margin % (on Rev)

$3,500.00

Total Cost

Getting started

How to use this profit calculator

This tool quickly helps you evaluate product pricing and verify margins.

Select calculation mode

Choose whether you want to calculate profit from Revenue + Cost or determine selling price from Cost + Profit %.

Enter values

Input your amounts. Use cost of goods sold (COGS) for the most accurate gross profit.

Review the results

Instantly see your profit amount, profit % (markup), and margin % on revenue.

The calculation

Step-by-step: how your profit was calculated

Here is exactly how your $1,500.00 profit was derived from the numbers above.

Calculate profit

Profit = Revenue - Cost = $5,000.00 - $3,500.00

Profit = $1,500.00

Calculate profit percentage

Profit % = (Profit / Cost) x 100 = ($1,500.00 / $3,500.00) x 100

Profit % = 42.86%

Calculate profit margin

Margin % = (Profit / Revenue) x 100 = ($1,500.00 / $5,000.00) x 100

Margin = 30%

Examples

Profit calculation examples

E-commerce

Retail Product

Rev $85 · Cost $35

$50

Profit (142.9% markup)

Business

Monthly Revenue

Rev $42,000 · COGS $28,000

$14,000

Profit (33.3% margin)

Target Pricing

40% Profit Target

Cost $60 · Target 40%

$84

Required selling price

Definitions

What is profit?

Profit is the fundamental measure of business health - the amount of money left after every cost is accounted for. Without positive profit, a business cannot sustain itself or grow. Understanding profit at the product, order, and business level is essential for pricing decisions, cost control, and strategic planning.

This calculator computes gross profit - revenue minus the direct cost of goods or services. To find net profit, subtract additional operating expenses (rent, payroll, marketing) from the gross profit figure.

Metric	Formula	Use Case
Profit Amount	Revenue - Cost	Absolute dollar earnings
Profit % (Markup)	(Profit / Cost) * 100	E-commerce, ROI analysis
Margin %	(Profit / Revenue) * 100	Finance, investor reporting

Strategy

Tips for improving profit & common mistakes

Keep these points in mind when analyzing margins.

Know your true cost

Include not just COGS but shipping, payment fees, returns, and storage in your cost base before setting a price.

Track profit at the product level

Aggregate revenue figures can hide individual products that are unprofitable. Run this calculator per SKU or service type.

Mistake: Confusing profit % with margin %

Profit % uses cost as the denominator; margin uses revenue. Using the wrong metric in a financial discussion can cause significant misunderstandings.

Mistake: Using revenue as a proxy for profit

A business can double revenue while profit stays flat or falls if costs grow proportionally. Revenue without profitability context is an incomplete picture.

FAQ

Frequently asked questions

What is profit?

Profit is the financial gain remaining after all costs are subtracted from total revenue. Gross profit subtracts only the direct cost of goods sold from revenue; net profit also deducts operating expenses, taxes, and interest. This calculator computes gross profit and profit percentage.

What is the profit formula?

Profit = Revenue - Cost. Profit Percentage = (Profit / Cost) * 100. Profit Margin = (Profit / Revenue) * 100. For example, revenue $150 and cost $90: Profit = $60, Profit % = 66.7%, Margin = 40%.

What is the difference between profit and profit margin?

Profit % uses cost as the base: (Profit / Cost) * 100. Profit margin uses revenue as the base: (Profit / Revenue) * 100. The same dollar profit gives a higher profit % than margin. A $60 profit on $90 cost = 66.7% profit %, but only 40% margin on $150 revenue.

What is a good profit percentage?

It depends on your industry. Retail typically sees 5-20% profit on cost, manufacturing 15-35%, software 100-500%+, and professional services 50-150%. Compare to your specific industry benchmarks rather than a universal number.

Can profit be negative?

Yes - when costs exceed revenue, the result is a loss (negative profit). Revenue of $80 with a cost of $100 yields a profit of -$20. This calculator displays negative profit and highlights it clearly.

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