Gross Margin Calculator
Gross margin is revenue minus included cost of goods, divided by revenue, multiplied by 100. Revenue of 1,000 and cost of 650 gives a gross profit of 350 and margin of 35%.
Formula & method
Gross profit = revenue − included cost; gross margin (%) = gross profit ÷ revenue × 100.Worked example
| Input | Value |
|---|---|
| Sales revenue | 1,000 ¤ |
| Included cost of goods | 650 ¤ |
| Result | Value |
|---|---|
| Gross profit | 350 ¤ |
| Gross margin | 35 % |
Compare scenarios
The first input changes while the other example inputs stay fixed. These are arithmetic scenarios, not forecasts.
| Compare scenarios | Sales revenue ¤ | Gross profit | Gross margin |
|---|---|---|---|
| −20% | 800 | 150 ¤ | 18.75 % |
| Example | 1,000 | 350 ¤ | 35 % |
| +20% | 1,200 | 550 ¤ | 45.83333333 % |
Assumptions & limits
Margin uses sales revenue as its denominator; markup uses cost. This arithmetic does not decide which costs belong in an accounting category. Use a consistent definition and account for overhead, taxes and other expenses separately.
Displayed results are rounded. Calculations use unrounded JavaScript numbers; small floating-point differences are possible.
Use the same currency and reporting period for every monetary input. This tool does not fetch prices, exchange rates or account data.
Works in your browser
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Sources & definitions
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