# Net Income Calculator

URL: https://speedycalculator.com/calculators/finance/net-income/
Last updated: 2026-10-25

> The net income calculator works out a company's or individual's net income – revenue minus cost of goods sold, operating expenses, interest and taxes – with gross and operating profit along the way and the net margin.

## Inputs

- Revenue
- Cost of goods sold
- Operating expenses
- Interest expense
- Other income (+) or expenses (−)
- Tax rate (%)

## Results

- Gross profit
- Operating income
- Earnings before tax
- Taxes
- Net income
- Net margin

## Formula

```
Gross profit = revenue − COGS
Operating income = gross profit − operating expenses
Net income = operating income − interest − taxes (+ other income)
```

## Explanation

Net income is the "bottom line" of the income statement – the profit available to shareholders. For individuals, net income usually means take-home pay after tax.

### How to use the Net Income Calculator

- **Revenue**
- **Cost of goods sold**
- **Operating expenses**
- **Interest expense**
- **Other income (+) or expenses (−)**
- **Tax rate**

Results update as you type, and every field accepts the units shown in its menu.

### How it works

Enter revenue, COGS, operating expenses, interest, other income and taxes.

### Tips

- Use consistent periods (a year or a quarter) for flow figures and period-end values for balances.
- Average opening and closing balances when a ratio mixes a flow with a stock.
- Benchmark against competitors in the same industry.
- Read the ratio together with others – profitability, liquidity and efficiency tell different stories.

### Common mistakes to avoid

- Using sales instead of cost of goods sold for inventory ratios.
- Mixing gross, operating and net profit.
- Ignoring one-off items that distort a single year.

### Inputs explained

FieldWhat to enterRevenueAmount in your currencyCost of goods soldAmount in your currencyOperating expensesAmount in your currencyInterest expenseAmount in your currencyOther income (+) or expenses (−)Amount in your currencyTax rateIn %

### What each result means

- **Gross profit** = [Revenue] - [Cost of goods sold]
- **Operating income** = [Gross profit] - [Operating expenses]
- **Earnings before tax** = [Operating income] - [Interest expense] + [Other income (+) or expenses (−)]
- **Taxes** = max([Earnings before tax], 0)×[Tax rate]÷100
- **Net income** = [Earnings before tax] - [Taxes]
- **Net margin** = [Net income]÷[Revenue]×100

### Example values

How the main result changes when **Revenue** changes and everything else stays at the example values above:

RevenueNet income500,000-325,000750,000-75,0001,000,000138,2501,250,000335,7501,500,000533,2502,000,000928,250

## Worked example

Inputs — Revenue: $1,000,000; Cost of goods sold: $550,000; Operating expenses: $250,000; Interest expense: $30,000; Other income (+) or expenses (−): $5,000; Tax rate: 21 %.

Results — Gross profit = $450,000.00; Operating income = $200,000.00; Earnings before tax = $175,000.00; Taxes = $36,750.00; **Net income = $138,250.00**; Net margin = 13.83 %.

## FAQ

**What is net income?**
Revenue minus all expenses, interest and taxes.

**Is net income the same as profit?**
It's the final profit figure, after everything.

**Is net income the same as cash flow?**
No – non-cash items and working capital make them differ.

**What formula does the Net Income Calculator use?**
Gross profit = revenue − COGS.


## Sources

- [Corporate Finance Institute – financial ratios](https://corporatefinanceinstitute.com/)