Interactive calculator
Gross margin calculator
See gross profit and the share of revenue left after direct costs.
Last reviewed 1 October 2026
Illustrative result
- Gross profit
- $20,000
- Gross margin
- 40.0%
Gross margin is the share of each sales dollar left after direct costs, before overheads and other expenses.
How to use this tool
Gross profit = revenue − direct costs. Gross margin = gross profit ÷ revenue × 100.
A simple example
$50,000 sales less $30,000 direct costs is $20,000 gross profit and a 40% margin.
Assumptions and limits
This is before overheads, tax, interest and other expenses. A high gross margin does not necessarily mean net profit.
General information only. Check your own records and speak with a qualified professional where the decision depends on accounting, tax, legal or financial advice.