Net Margin Calculator

Calculate net profit margin, along with gross and operating margin, from a simple profit and loss statement.

What is the Net Margin Calculator?

Net margin is the percentage of revenue left as profit after all expenses, interest and taxes — the “bottom line”.

How does it work?

Gross profit = revenue − COGS; operating profit = gross profit − operating expenses; net profit = operating profit − interest − tax + other income.

Formula

Net margin % = Net profit ÷ Revenue × 100

Example

Revenue ₹50 lakh, COGS ₹28 lakh, operating expenses ₹12 lakh, interest ₹1 lakh and tax ₹2.25 lakh leave ₹6.75 lakh net profit — a 13.5% net margin.

Frequently asked questions

Why can net margin be negative?

If expenses, interest and tax exceed gross profit, the business makes a net loss and the margin is negative.

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