Determine revenue (total sales) for the period
Determine expenses for the same period
Choose the type of profit margin:
Gross profit margin: (Revenue − Cost of goods sold) ÷ Revenue × 100
Operating profit margin: Operating income ÷ Revenue × 100
Net profit margin: Net income ÷ Revenue × 100
Compute the margin:
Profit margin (%) = (Profit ÷ Revenue) × 100
Verify units match (all amounts for the same period and currency)
If needed, use Revenue − Total expenses for a general profit margin:
Profit margin (%) = (Revenue − Total expenses) ÷ Revenue × 100