Free SaaS Gross Margin Calculator

Quick answer

SaaS gross margin measures the share of revenue left after the direct costs required to deliver the product, such as infrastructure, payment processing, and direct support costs included in COGS.

Formula

Gross margin = (revenue − cost of goods sold) ÷ revenue × 100

Example

00,000 revenue and $20,000 COGS produces an 80% gross margin.

How to interpret it

Use a consistent COGS policy over time so margin changes reflect the business rather than accounting reclassification.

Methodology, assumptions and limitations