Gross Margin Calculator
Calculate gross margin and gross profit from revenue and COGS.
GROSS MARGIN
75.0%
$75,000
Gross profit
Gross margin = (revenue − COGS) ÷ revenue × 100. Healthy SaaS runs 70–85%+.
What is Gross Margin?
Gross margin is the percentage of revenue left after the direct cost of delivering your product (COGS). For SaaS it's a key sign of a scalable, efficient business.
Gross margin = (revenue − COGS) ÷ revenue × 100
How to read your result
- Healthy SaaS gross margins are typically 70–85%+.
- COGS for SaaS = hosting, support, payment fees, third-party APIs.
- Higher gross margin means more revenue to fund growth.
- Gross profit = revenue − COGS (the dollar figure behind the margin).
Frequently asked questions
What is a good gross margin for SaaS?
Software businesses usually target 70–85% or higher, since the cost to serve each additional customer is low.
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