Profit & Margin

Gross Profit Calculator

Calculate gross profit and gross margin percentage from revenue and cost of goods sold.

Calculator

Enter revenue and COGS

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Result

Gross profit

Gross profit $18,000.00
Gross margin 36%

Formula

Gross Profit = Revenue - Cost of Goods Sold Gross Margin = Gross Profit / Revenue * 100

Example

If revenue is $50,000 and cost of goods sold is $32,000, gross profit is $18,000. Gross margin is 36%.

For the difference between gross and net numbers, read gross profit vs net profit.

Common mistakes

  • Putting all operating expenses into cost of goods sold without a clear accounting reason.
  • Comparing gross margin between businesses that define COGS differently.
  • Using gross profit as if it were final take-home profit.

Use the Profit Margin Calculator for a general revenue and cost calculation, or the Markup Calculator for pricing from cost.

FAQ

What is gross profit?

Gross profit is revenue minus cost of goods sold.

How do you calculate gross margin?

Divide gross profit by revenue, then multiply by 100.

Is gross profit the same as net profit?

No. Gross profit usually excludes operating expenses, taxes, interest, and other costs.

Can gross profit be negative?

Yes. If cost of goods sold is higher than revenue, gross profit is negative.

Disclaimer

This calculator is for general business planning and educational use. It does not replace accounting, tax, or financial advice.