Net Profit Margin Calculator
Bottom-line margin.
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Business
Operating Margin Calculator
Find your operating margin from revenue and operating income.
Operating margin
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Of revenue.
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| Revenue | — |
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How the Operating Margin Calculator Works
Operating margin is the profit from core operations as a share of revenue, before interest and taxes. Divide operating income (revenue minus cost of goods and operating expenses) by revenue. On $500,000 of revenue with $90,000 of operating income, the operating margin is 18%.
It shows how efficiently the business runs its actual operations, stripping out financing and tax effects. That makes it a clean way to compare companies’ operational health across different capital structures and tax situations.
operating margin = operating income ÷ revenue
Frequently Asked Questions
How do you calculate operating margin?
Divide operating income (revenue minus cost of goods and operating expenses) by revenue, then multiply by 100.
How is it different from net margin?
Operating margin stops before interest and taxes, so it reflects core operations. Net margin includes everything down to the bottom line.
What is a good operating margin?
It varies by industry, but higher is better. Many healthy businesses run operating margins in the 10–20% range.
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