Net Profit Margin vs. Gross Profit Margin Net profit margin and gross profit margin both measure profitability but focus on different aspects of a company's finances.

Your gross profit margin can be calculated with the following formula: Gross Profit Margin = (Revenue - Cost of Goods Sold / Revenue) x 100. Subtract the cost of goods sold (COGS) from total ...

Gross profit describes a company's top-line earnings; that is, its revenues less the direct costs of goods sold. The gross profit margin then takes that figure and divides it by revenue to get a ...

Using Profit-Margin Ratios Let's face it, any company's most important goal is to make money and keep it. How well it accomplishes that depends on its liquidity and efficiency.

Some companies diverge from gross margin and use dynamic margin instead. This is calculated using the same formula, price – cost/price, but you add in only the variable costs of making your ...