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Net Profit Margin Calculator

Written by:
PK

Below is an net margin calculator or net profit margin calculator to compute a company's bottom line margin. Enter a company's top line revenues and bottom line earnings to compute its net income margin

Net Profit Margin Calculator

What is the Net Profit Margin?

Net income margin measures a company's earnings efficiency, and it the percentage of revenue that net income represents. Unlike other margins, it is the "cleanest" measure of a company's profitability, using net income the company reports to the market on top of its top line sales number.

Net Income does sometimes disguise good (and bad) things happening at companies, however. Other margin metrics like EBIT, EBITA, and EBITDA can show a company's efforts in a turnaround and hint at future profits, and might better align with company cash flows. Gross profit margins show the company's basic economics and the business opportunity, and operating margin strips out any non-operating incomes and expenses.

Net Profit Margin Formula

The formula for net profit margin is:

Net\ Profit\ Margin=\frac{net\ income}{revenue}

Where:

  • Net Income: Net income from the income statement
  • Revenue: The company's top line sales

Margin Calculators

Once you're done computing net margin, try some of the other margin calculators:

      

PK

PK started DQYDJ in 2009 to research and discuss finance and investing and help answer financial questions. He's expanded DQYDJ to build visualizations, calculators, and interactive tools.

PK is in his mid-30s and works and lives in the Bay Area with his wife, two kids, and dog.

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