Operating Margin
Finance CalculatorsCalculate efficiency by finding operating income over revenue.
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Operating Margin
About This Tool
Free Operating Margin Calculator. Measure a company's pricing strategy and operating efficiency by calculating the percentage of revenue remaining after paying for variable costs.
Frequently Asked Questions
Operating margin shows how much profit a company makes on a dollar of sales after paying for variable costs but before paying interest or tax.
Generally yes, as it indicates a more efficient company. However, very high margins might invite competition or suggest the company is not reinvesting enough for growth.
EBIT stands for Earnings Before Interest and Taxes. It is synonymous with operating income and is used as the numerator in the operating margin calculation.
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