Net Profit Calculator — Full Profit Waterfall from Revenue to Net
See exactly how revenue becomes bottom-line profit after COGS, operating expenses, interest, and tax.
Tax pre-filled at 21% for United States.
Inputs
$
$
$
Rent, salaries, marketing, utilities
$
Loan interest paid in the period
%
Revenue$500,000.00
− COGS-$250,000.00
Gross Profit$250,000.00
− Operating Expenses-$150,000.00
Operating Profit (EBIT)$100,000.00
− Interest-$8,000.00
EBT$92,000.00
− Tax (21%)-$19,320.00
Net Profit
Healthy$72,680.00
Healthy net margin — bottom line is sustainable.
Net Margin: 14.5%
How it works
The calculator walks down the income statement: start with revenue, deduct COGS to get gross profit, deduct operating expenses for operating profit (EBIT), deduct interest for earnings before tax (EBT), then deduct tax. What remains is net profit. The waterfall on the right shows each step.
See the formula
Gross Profit = Revenue − COGS Operating Profit = Gross Profit − Operating Expenses EBT = Operating Profit − Interest Expense Tax = EBT × Tax Rate / 100 (only on positive EBT) Net Profit = EBT − Tax Net Profit Margin = Net Profit / Revenue × 100
Frequently Asked Questions
What is net profit?
Net profit is the amount of money a business has left after paying ALL its expenses — including cost of goods sold, operating costs, interest on loans, and tax. It is the true bottom-line measure of business profitability, also called the "bottom line".
What is the difference between gross profit and net profit?
Gross profit = Revenue minus Cost of Goods Sold only. Net profit = Revenue minus ALL costs including COGS, operating expenses, interest, and tax. A business with a high gross profit margin can still have a low or negative net profit if overhead costs are high.
How do I calculate net profit margin?
Net Profit Margin (%) = (Net Profit / Revenue) × 100. If your net profit is $25,000 on revenue of $200,000, your net profit margin is 12.5%. This means you keep $12.50 for every $100 of revenue after paying all costs.
What is EBITDA and is it the same as net profit?
EBITDA (Earnings Before Interest, Tax, Depreciation, and Amortisation) is not the same as net profit. EBITDA excludes these four items to give a measure of operational profitability. Net profit includes them all. Investors often use EBITDA for business valuation; net profit for assessing true returns.
What is a good net profit margin?
It varies significantly by industry. Retail: 2–5%. Software/SaaS: 20–30%. Consulting: 15–25%. Manufacturing: 5–10%. A net margin above 10% is generally considered healthy. Below 5% is thin and vulnerable to cost increases or revenue decline.
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For information only. This calculator does not constitute financial, accounting, or tax advice. Consult a qualified professional before making business decisions.