Net Profit Margin Calculator
Calculate net profit margin from revenue, expenses, taxes, and other income to see how much profit your business keeps from sales.
Overview
A net profit margin calculator helps you measure how much profit your business keeps from each amount of revenue after operating expenses, interest, taxes, and other income are considered. It is useful for comparing profitability across periods or checking how efficiently a business turns sales into profit.
How it works
The calculator first adds operating expenses, interest expense, and taxes to find total costs. It then calculates net profit by adding revenue and other income and subtracting those costs. Finally, it divides net profit by revenue and multiplies by 100 to show net profit margin as a percentage. A higher margin generally means more of each sales dollar is kept as profit.
How to use this calculator
- 1Enter your total revenue for the period.
- 2Add your operating expenses.
- 3Enter any interest expense and taxes.
- 4Include other income if you want it reflected in net profit.
- 5Review your net profit and net profit margin results.
Example Calculation
Total Revenue
$100,000
Operating Expenses
$70,000
Interest Expense
$2,000
Taxes
$5,000
Other Income
$1,000
Net Profit Margin
24.00%
With revenue of 100000, total costs of 77000, and other income of 1000, the net profit is 24000 and the net profit margin is 24.00%.
Frequently asked questions
What does net profit margin measure?
Net profit margin measures the percentage of revenue left after all entered expenses, interest, taxes, and other income are taken into account.
What is a good net profit margin?
A good net profit margin depends on the industry, business model, and stage of growth. It is often most useful when compared with your own past results or industry averages.
Should I include tax in net profit margin?
Yes, this calculator includes taxes in the net profit calculation because net profit is typically measured after tax expense.
Can net profit margin be negative?
Yes. If your total costs exceed revenue plus other income, net profit will be negative and the margin will also be negative.
Do I need to include other income?
Only if you want non-operating income included in net profit. If not, enter 0 for other income.
Explore Related Calculators
Assumptions and warnings
Assumptions
- Results are estimates based only on the values you enter.
- Revenue and costs should all relate to the same accounting period.
- The calculator treats taxes as a direct expense entered by the user.
- It does not adjust for accounting standards, depreciation methods, or exceptional items unless included in your inputs.
Warnings
- This calculator provides an estimate only and is not accounting, tax, or financial advice.
- Use figures from the same period and currency for a meaningful result.