Free Business Calculator

Gross Profit Calculator

Calculate gross profit and gross profit margin from your revenue and cost of goods sold.

Calculate Gross Profit

Enter your total revenue and cost of goods sold.

$
Enter the total sales or revenue generated.
$
Enter the direct cost of producing or purchasing the goods sold.

Your Results

Gross Profit
$0.00
Gross Margin
0.00%
Revenue
$0.00
Cost of Goods Sold
$0.00
Enter your revenue and cost to calculate gross profit.

What Is Gross Profit?

Gross profit is the amount of money a business has left after subtracting the cost of goods sold (COGS) from its revenue.

It shows how much revenue remains after covering the direct costs associated with producing or purchasing the products or services sold.

Gross Profit = Revenue − Cost of Goods Sold

Gross Profit Formula

Gross Profit = Revenue − COGS

Gross Profit Margin Formula

Gross Profit Margin = (Gross Profit ÷ Revenue) × 100

Gross Profit Example

Suppose a business generates $10,000 in revenue and has $6,000 in cost of goods sold.

  • Revenue = $10,000
  • COGS = $6,000
  • Gross Profit = $4,000
  • Gross Profit Margin = 40%
The business has $4,000 in gross profit.

What Is Cost of Goods Sold (COGS)?

Cost of Goods Sold, commonly called COGS, represents the direct costs associated with producing or purchasing the products a business sells.

Depending on the business, COGS can include product purchase costs, raw materials, manufacturing costs, and other direct costs related to the goods sold.

Important: COGS is different from operating expenses such as rent, advertising, office expenses, software subscriptions, and administrative costs.

How to Use the Gross Profit Calculator

1

Enter Revenue

Enter the total revenue generated from selling your products or services.

2

Enter COGS

Enter the direct cost associated with the products sold.

3

Calculate

The calculator instantly shows gross profit and gross margin.

Gross Profit vs Net Profit

Gross profit and net profit are not the same. Gross profit focuses on revenue after direct product costs, while net profit accounts for additional business expenses.

Metric What It Measures
Gross Profit Revenue minus Cost of Goods Sold.
Net Profit Profit remaining after applicable business expenses and other costs are deducted.
FAQ

Frequently Asked Questions

Common questions about gross profit calculations.

Gross profit is the revenue remaining after subtracting the cost of goods sold (COGS). It measures the amount earned before other operating expenses are considered.

Gross Profit = Revenue − Cost of Goods Sold (COGS).

Gross profit margin expresses gross profit as a percentage of revenue. The formula is (Gross Profit ÷ Revenue) × 100.

Gross profit subtracts direct costs such as COGS from revenue. Net profit goes further by accounting for applicable operating expenses, interest, taxes, and other costs.

Yes. If the cost of goods sold is greater than revenue, gross profit becomes negative. This indicates that the direct cost of the goods exceeded the revenue generated from their sale.

This basic calculator does not deduct expenses such as rent, advertising, salaries, software, office expenses, taxes, interest, or other operating costs.

Yes. Ecommerce businesses can use it to calculate gross profit from sales revenue and the direct cost of products sold. Other expenses such as advertising, payment fees, shipping, and returns may need separate calculations.

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