Net Profit Calculator
Quickly determine net profit by subtracting all expenses from total revenue for a matched time period. Use this figure to assess profitability, plan cash flow, and benchmark against prior periods or industry peers.
For strategic or tax decisions, consult a certified accountant or financial advisor. This tool is for educational planning only.
Examples
- Revenue $875,000 and expenses $645,000 ⇒ net profit $230,000 (healthy 26% margin).
- Revenue $420,000 and expenses $455,000 ⇒ net loss −$35,000 signalling cost overruns.
- Revenue $1,250,000 and expenses $1,020,000 ⇒ net profit $230,000 after accounting for taxes and depreciation.
FAQ
Which expenses should I include?
Include all direct and indirect costs tied to the period—COGS, payroll, rent, utilities, marketing, interest, taxes, and non-cash charges like depreciation and amortization.
Should I use accrual or cash accounting?
Match the method you use for financial statements. Accrual accounting aligns revenue and expenses to when they are earned or incurred, giving a clearer profitability picture.
How do I interpret a negative result?
A negative net profit indicates a net loss. Review spending categories, pricing, and revenue drivers to identify issues and consider cost controls or growth initiatives.
How often should I calculate net profit?
Run the calculation monthly and quarterly for internal monitoring, and annually for audited financial reporting or tax filings.
Additional Information
- Formula: Net Profit = Total Revenue − Total Expenses (including COGS, operating costs, interest, and taxes).
- Use consistent currency and reporting periods for both inputs to avoid distorted results.
- Positive results indicate profit; negative results indicate a net loss that should be investigated for cost savings or revenue opportunities.
- Compare this figure with net profit margin (net profit ÷ revenue) to evaluate efficiency over time or against competitors.