# Net Profit Margin

## Description

Profit margin, net margin, net profit margin or net profit ratio all refer to a measure of profitability. It is calculated by finding the net profit as a percentage of the revenue. Profit margin is calculated with selling price (or revenue) taken as base times 100. Profit margin is the percentage of selling price that turned into profit, where as “Profit Percentage” or “Markup” is the percentage of cost price that one gets as profit on top of cost price.

Related formulas## Variables

NP_{margin} | net profit margin (profit as percentage of selling price or revenue) (dimensionless) |

NP | net profit (dimensionless) |

R | revenue (dimensionless) |