Operating Margin Calculator
Measure operating profit as a percentage of revenue.
OPERATING MARGIN
20.0%
Operating margin = operating income ÷ revenue × 100. It shows core profitability before interest and taxes.
What is Operating Margin?
Operating margin is operating income as a percentage of revenue. It shows how much profit your core business makes before interest and taxes — a clean read on operating efficiency.
Operating margin = operating income ÷ revenue × 100
How to read your result
- Operating income = revenue − COGS − operating expenses.
- It excludes interest and taxes, isolating operations.
- A rising operating margin signals improving operating leverage.
- Compare it against peers in your industry, not across sectors.
Frequently asked questions
How is operating margin different from gross margin?
Gross margin only subtracts COGS. Operating margin also subtracts operating expenses like sales, marketing, and R&D, so it's always lower.
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