Net Profit Calculator

Calculate gross, operating, and net profit from revenue and expenses. See all profit margins.

By Konstantin Iakovlev · Updated September 2026 · Source: SBA — Business Guide

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Gross Profit

$650,000.00

65.0% margin

Operating Profit

$350,000.00

35.0% margin

Net Profit

$250,000.00

25.0% margin

Income Statement

Revenue$1,000,000.00
Cost of Goods Sold- $350,000.00
Gross Profit$650,000.00
Operating Expenses- $250,000.00
Depreciation- $50,000.00
Operating Profit (EBIT)$350,000.00
Interest Expense- $25,000.00
Pre-Tax Profit$325,000.00
Taxes- $75,000.00
Net Profit$250,000.00

Profit Margins

Gross Margin65.0%
Operating Margin35.0%
EBITDA$400,000.00
EBITDA Margin40.0%
Net Margin25.0%

Use the Net Profit Calculator above to calculate your results. Enter your values and see instant results — all calculations run in your browser.

Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.

How It Works

Profit comes in layers, and separating them tells you far more about a business than a single bottom-line number ever could. This tool breaks revenue down into gross, operating, and net profit so you can read operational efficiency at each stage.

The math runs in a cascade. Gross Profit is Revenue minus the Cost of Goods Sold (COGS). Subtract Operating Expenses (OpEx) and Depreciation from that, and you have Operating Profit (EBIT); adding depreciation back gives EBITDA, which the tool also shows. Take Interest out of Operating Profit to get Pre-Tax Profit, then Taxes, and what remains is Net Profit, the figure that accounts for every direct and indirect cost the business carries. Each profit line is also shown as a margin on revenue.

How you categorize expenses determines whether these numbers mean anything. Folding COGS into operating expenses is a frequent error that quietly inflates your gross margin and misleads every ratio built on it. Non-operating items such as one-time asset sales or extraordinary losses sit outside operating profit but still belong in net profit, so place them carefully.

Example: Tech Startup's Quarterly Profitability

  1. 1 Input: quarterly Revenue of $750,000, Cost of Goods Sold (COGS) of $280,000, Operating Expenses (salaries, rent, marketing) of $220,000, Depreciation of $30,000, Interest Expense of $15,000 and Taxes of $45,000.
  2. 2 Gross Profit: $750,000 − $280,000 = $470,000, a 62.7% gross margin. Operating Profit (EBIT): $470,000 − $220,000 − $30,000 = $220,000, a 29.3% operating margin. EBITDA: $220,000 + $30,000 = $250,000, a 33.3% margin.
  3. 3 Pre-Tax Profit: $220,000 − $15,000 = $205,000. Net Profit: $205,000 − $45,000 = $160,000, a 21.3% net margin ($160,000 / $750,000).
  4. 4 Of each revenue dollar, about 37 cents goes to COGS, 33 cents to operating expenses and depreciation, and 8 cents to interest and taxes, leaving about 21 cents of profit.

Source: SBA — Business Guide · Last updated: September 2026

Frequently Asked Questions

What is the difference between gross profit and net profit?
Gross profit is revenue minus cost of goods sold (direct costs). Net profit is what remains after all expenses: COGS, operating expenses, interest, and taxes. A company can have strong gross margins but weak net profit if operating expenses or debt costs are high.
What is a good net profit margin?
It varies widely by industry. Software companies average 20-30% net margins. Retail averages 3-5%. Restaurants average 3-9%. Professional services average 10-20%. Generally, double-digit net profit margins are considered healthy for most industries.
How do I calculate net profit margin?
Net profit margin = (net income / total revenue) x 100. If your business earned $500,000 in revenue and $75,000 in net income, your net profit margin is 15%. Track this quarterly and compare to industry benchmarks.