50,000 USD revenue, 32,000 USD costs
Gross profit is 50,000 minus 32,000, which is 18,000. Margin is 18,000 divided by 50,000, times 100, which is 36%.
Agency profit margin calculator
Profit margin shows how much of your agency’s revenue is actually profit once costs are covered, as a percentage you can track over time or compare across clients. This calculator subtracts your total costs from revenue to get gross profit, then divides gross profit by revenue and multiplies by 100 for the margin. A thin or negative margin on a client is a signal to raise price, cut cost, or offboard it.
Calculate your agency’s profit margin
Total revenue for the period or client you are measuring.
Everything spent to deliver the work: salaries, contractors, software, ad spend.
36.0%
Share of revenue remaining as profit after costs.
- Gross profit
- $18,000
Formula
gross profit = revenue − costs; margin = gross profit ÷ revenue × 100
What is an agency profit margin?
The share of revenue left after costs, as a percentage: profit divided by revenue, times 100. A 36% margin means 36 cents of every dollar a client pays stays as profit. Because it is a percentage, it compares clients and months of different sizes, which a dollar profit figure cannot.
What is the difference between gross, operating and net margin?
Which costs you subtract. Enter only a client’s direct costs and the calculator gives gross margin; include overhead and it gives operating margin:
| Margin | What it subtracts | What it tells you |
|---|---|---|
| Gross margin | Revenue minus the direct cost of delivering the work (team time, contractors, client tools) | Whether a client or service is priced right |
| Operating margin | Gross profit minus overhead (rent, sales, admin, agency-wide software) | Whether the agency as a whole makes money |
| Net margin | Operating profit minus interest and tax | What the owners keep |
What is a good profit margin for an agency?
It depends on size and service mix, so compare with agencies like yours. Gould+Partners’ 2026 benchmarking survey found North American PR agencies averaged 15.3% operating profit in 2025, rising with size:
| Agency size | Average operating profit |
|---|---|
| Over $25M net revenue | 20.2% |
| $10M to $25M | 14.0% |
| $3M to $10M | 13.4% |
| Under $3M | 8.5% |
| All agencies surveyed | 15.3% (16.6% in 2024) |
Per-client gross margins run higher than these operating figures, because overhead is not yet subtracted. The trend in your own numbers, month to month and client by client, tells you more than any average.
How do you use the agency profit margin calculator?
- Enter revenue. Use the total revenue for the period or client you are measuring, before any costs are subtracted.
- Enter costs. Include everything spent to deliver the work: salaries, contractors, software and ad spend if you manage media.
- Read the gross profit. Gross profit is revenue minus costs, shown as a plain dollar figure before the percentage.
- Read the profit margin. Margin is gross profit divided by revenue, shown as a percentage so you can compare periods or clients of different sizes.
- Compare across clients or months. Run the same numbers for each client or period, since a single margin figure means little without something to compare it against.
What does it look like in practice?
15,000 USD revenue, 15,750 USD costs
Gross profit is 15,000 minus 15,750, which is -750. Margin is -750 divided by 15,000, times 100, which is -5%, meaning this client cost more to serve than it paid.
How do you improve an agency’s profit margin?
Price for the real cost to serve, cut the hours that do not reach the client, and keep tool costs from growing with headcount. Check what to charge with the agency pricing calculator. In social media work, much of the hidden cost is posting by hand and chasing approvals: SkedCast bulk-schedules a month per client, gets client approval without a login, and is priced by connected account, so adding a teammate does not raise the bill. See SkedCast for agencies and its white-label reports.
Agency profit margin FAQ
- How do you calculate profit margin for an agency?
- Subtract total costs from revenue to get gross profit, then divide gross profit by revenue and multiply by 100. A 36 percent margin means 36 cents of every revenue unit remained as profit after costs.
- What counts as costs in this calculator?
- Anything spent to deliver the work you are measuring: staff time, contractors, software, tools and any ad spend you manage on a client’s behalf. Leave out costs that do not relate to what you are measuring.
- What is a good profit margin for an agency?
- It depends on size and services. Gould+Partners’ 2026 survey found North American PR agencies averaged 15.3 percent operating profit in 2025, from 8.5 percent under 3 million dollars of revenue to 20.2 percent over 25 million. Per-client gross margins run higher, since overhead is not yet subtracted.
- Should I calculate margin per client or for the whole agency?
- Both are useful for different decisions. A whole-agency margin shows overall health, while a per-client margin shows which specific clients are profitable and which are quietly losing money once their real cost to serve is counted.
- What does a negative margin mean?
- It means costs exceeded revenue for that period or client, so the work lost money rather than made it. That is usually a signal to raise price, cut scope, reduce cost, or consider offboarding the client.
- Is gross profit the same as net profit?
- No. Gross profit here is revenue minus the costs you enter, not a full accounting net profit after overhead, taxes and other business-wide expenses that this calculator does not ask for.
- Does the calculator store my revenue or cost numbers?
- No. The calculation happens entirely in your browser as you type, and nothing is uploaded or saved.
- What is the difference between gross and net profit margin?
- Gross margin subtracts only the direct cost of delivering the work; net margin also subtracts overhead, interest and tax. Use gross margin to price clients and net margin to judge the business.
Sources
The benchmark figures on this page come from:
Ready to broadcast everywhere?
Sign up free — no credit card. You land on the Free plan, and you can start a one-time 7-day Studio trial from your workspace whenever you are ready. Connect your first accounts, import a batch, and watch one post fan out across every platform.