Gross Profit
Revenue minus COGS. Shows product-level profitability. Are you making money on each unit sold before overhead?
Calculate your true bottom-line profit after ALL expenses. Enter revenue, cost of goods sold (COGS), operating expenses, and taxes to see net profit, gross margin, operating margin, and net margin.
Net profit is the true bottom line — what's left after every expense is paid. Revenue minus cost of goods, operating expenses, interest, and taxes. It's the most important number on your income statement.
A business can have huge revenue but tiny or negative net profit. Revenue is vanity, profit is sanity. A $100K revenue business with 22.5% net margin keeps $22,500 — that's the owner's actual return.
This calculator breaks down three key margins: Gross (after COGS), Operating (after OpEx), and Net (after taxes). Each level reveals different aspects of business efficiency.
Revenue minus COGS. Shows product-level profitability. Are you making money on each unit sold before overhead?
Gross profit minus operating expenses (rent, salaries, marketing). Shows core business viability regardless of tax structure.
The final number after all expenses and taxes. This is what you actually take home or reinvest. The ultimate measure of business success.
High margins from low marginal costs. Top companies like Apple (25%), Microsoft (35%), Google (22%).
Volume-driven, razor-thin margins. Walmart: 2.4%, Target: 3.5%, Costco: 2.6%. Every penny of efficiency matters.
Notoriously thin margins. Fast food: 6-9%. Full service: 3-5%. Fine dining: varies wildly.
Pharma companies: 15-25%. Hospitals: 3-8%. Medical devices: 10-20%. Wide variation by sub-sector.
Property management: 10-15%. REITs: 15-25%. Development: varies by project, 10-30% target.
Low overhead, high margins. Solo consultants can achieve 40%+. Agencies: 10-20% after payroll.
Gross profit = Revenue − COGS only. Net profit = Revenue − ALL expenses (COGS + operating expenses + taxes + interest). Net profit is always less than or equal to gross profit.
It depends on industry. Any positive net margin is technically profitable. 5% is acceptable in many industries. 10%+ is good. 20%+ is excellent. Compare to your specific industry average.
Three levers: increase revenue (pricing, volume, upsells), decrease COGS (supplier negotiation, efficiency), or reduce expenses (automation, outsourcing, waste elimination). Also optimize tax strategy.
Rent, utilities, salaries (non-production), marketing, insurance, depreciation, office supplies, software subscriptions — everything NOT directly tied to producing your product/service.
Absolutely. Many startups generate millions in revenue while losing money. If COGS + expenses + taxes > revenue, net profit is negative. This is common during growth phases.
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