Profit Margin Calculator
Enter what an item costs you and what you sell it for, and see the gross profit, the profit margin, and — because the two are endlessly confused — the equivalent markup side by side. Works in any currency; nothing you type leaves your browser.
Margin from cost and selling price
Example: cost 60, selling price 100 — a 40% margin.
How the margin is calculated
Gross profit is simply selling price minus cost; margin expresses that profit as a share of the selling price: margin% = (revenue − cost) ÷ revenue × 100. Buying at 60 and selling at 100 gives a profit of 40 and a margin of 40% — figures this page computes with the same tested engine as the calculator above. Because the denominator is revenue, margin answers the retailer's question: of every unit of money a customer hands over, how much do I keep?
Margin vs. markup — don't swap the denominators
The single most common pricing mistake is quoting a markup as if it were a margin, or vice versa. The same 60-cost, 100-price sale is a 40% margin (profit ÷ price) but a 66.67% markup (profit ÷ cost). A shop that wants a 40% margin but applies a 40% markup ends up cheaper than intended and quietly gives away profit on every sale. If you start from cost and a target percentage on top, you want the markup calculator; if you are checking totals across many sales, the profit calculator works from revenue and overall costs.
Reading the result
A positive margin means the sale contributes profit; -25% on a 100-cost, 80-price sale means each sale loses 20. Margins are comparable across products of very different prices precisely because they are ratios — which also means a healthy-looking margin on a slow seller can still earn less in total than a thin margin on volume. Margin alone never tells the whole story; it tells you the share of each sale you keep.
Frequently asked questions
What is a profit margin?
Profit as a share of the selling price: margin% = (revenue − cost) ÷ revenue × 100. Buy at 60 and sell at 100 and the margin is 40% — 40 of every 100 you charge is profit.
What is the difference between margin and markup?
They divide the same profit by different bases. Margin divides by the selling price; markup divides by the cost. Cost 60 sold at 100 is a 40% margin but a 66.67% markup — one sale, two very different-looking percentages.
Can a margin be negative?
Yes. A negative margin means the item sold below cost: buy at 100 and sell at 80 and the margin is -25%, a loss of 20 per sale. The calculator reports it as a loss rather than treating it as an error.
What is the difference between gross margin and net margin?
Gross margin uses only the direct cost of what you sold. Net margin subtracts every other cost as well — rent, wages, marketing, fees — so it is always lower. This page computes the gross figure for a single item; for totals across a period, the profit calculator takes overall revenue and costs.
Why can a markup exceed 100% when a margin cannot?
Margin is profit ÷ revenue, and profit can never exceed the revenue that contains it, so margin tops out below 100% whenever cost is above zero. Markup is profit ÷ cost, and profit can be any multiple of cost: a service costing 150 sold at 1,200 has a 87.5% margin but a 700% markup.
Everything on this page is computed locally in your browser; your figures are never transmitted. The margin and markup formulas are implemented as tested, typed functions — see the methodology page.