Profit margin = (Net profit ÷ Revenue) × 100
Net profit = Revenue − Total expenses
Gross profit margin = (Gross profit ÷ Revenue) × 100
Gross profit = Revenue − Cost of goods sold
Operating profit margin = (Operating profit ÷ Revenue) × 100
Operating profit = Gross profit − Operating expenses
Identify the profit type you want to measure
Gather the correct revenue and expense figures
Subtract expenses from revenue to find profit
Divide profit by revenue
Multiply the result by 100 to get a percentage
Compare the margin across periods or businesses