Learn about gross, operating, and net profit margins, how each is calculated, and how businesses and investors can use them to analyze a company’s profitability.

For example, the profit margin calculation is -10 percent if the company reports a loss of $20 million on sales of $200 million ($-20 million divided by $200 million).

For example, if a company generates $1,000 in revenue and has $800 in expenses, its profit is $200. The profit margin, in this case, would be 20%.

The gross profit margin in dollars is calculated by subtracting the COGS from total sales revenue. To figure the gross margin percentage, divide the dollar result by total revenue. For example, if ...

For example, a company with revenue totaling $100,000 and costs of goods sold totaling $35,000, would have a gross profit of $65,000 and a gross profit margin of 65%.

To understand how profitable a business is, many leaders look at profit margin, which measures the total amount by which revenue from sales exceeds costs. But if you want to understand how a ...

Image: Luca Lorenzelli/Adobe Stock A previous TechRepublic tutorial, How to calculate profit margin in Microsoft Power BI using a calculated column, shows you how to calculate profit margin as a ...