A firm’s gross margin reflects its ability to sell a product for more than the cost of producing it. It is calculated by dividing gross profit by revenue.Gross margin is a key profitability metric for a company. It's important to note that gross margin only considers the costs of revenue and does not include other costs such as administrative and selling expenses, taxes, or interest payments.
Learn Gross Margin with interactive examples and practice exercises in our Performance Metrics module.
This interactive learning module helps you understand Gross Margin through hands-on practice and real-world examples.