Profit Margin Calculator
Calculate net profit margin from revenue and net income.
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How this calculator works
Net profit margin shows how much reported net income remains from each unit of revenue after operating costs, financing, tax and other items.
Formula
Worked example
$12 million of net income on $100 million of revenue produces a 12% net profit margin.
How to interpret the result
Net profit margin shows how much reported net income remains from each unit of revenue after operating costs, financing, tax and other items.
Assumptions & limitations
One-time gains/losses, tax effects and capital structure can materially change net margin. Cross-industry comparisons require care.
Practical context
When this calculator is useful
Net profit margin is useful for understanding how much reported net income remains from each unit of revenue after operating costs, interest, taxes and other included items.
How investors commonly use it
Investors often track margin trends alongside revenue growth to see whether a company is scaling efficiently or whether growth is being offset by rising costs.
What this metric does not tell you
Net margin can move because of financing, tax rates, asset sales or one-time accounting items that have little to do with core operations. It should therefore be compared with operating margin and cash-flow measures.