Profit and pricing
Profit Margin Calculator
Use this free profit margin calculator to estimate how much revenue turns into actual profit after direct costs and extra expenses.
Formula
- Gross profit = Revenue - Direct costs
- Net profit = Revenue - Direct costs - Additional expenses
- Profit margin = Net profit / Revenue * 100
- Cost percentage = Total costs / Revenue * 100
Examples
- A $1,000 product launch with $250 in direct costs and $100 in expenses leaves $650 in net profit.
- A freelance project billed at $2,500 with $400 in contractor help and $150 in tools leaves $1,950 before taxes.
- A template shop with $800 in revenue and $120 in marketplace costs keeps $680 before other overhead.
When to use this calculator
- Check whether a product price leaves enough room after costs.
- Compare two offers with different cost structures.
- Estimate how much profit is left before tax or owner pay.
Common mistakes
- Using revenue as profit.
- Forgetting software, contractor, or fulfillment expenses.
- Comparing margins without using the same cost categories.
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Sources and assumptions
This calculator uses the formula and assumptions shown on this page.
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This calculator provides estimates for informational purposes only. It is not financial, tax, legal, or professional advice. Always verify current platform fees and consult a qualified professional for decisions that affect your business or finances.