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Gross Margin
Definition
Revenue minus the cost of goods sold (COGS), expressed as a percentage of revenue. Gross margin indicates how efficiently a company produces its goods or delivers its services and determines how much revenue is available to cover operating expenses and generate profit.
Related Terms
General Partner (GP)
Generative AI
Geographical Indications
Go-to-Market (GTM) Strategy
Going Concern Value
Related FAQ
What is Gross Margin and Contribution Margin?
Gross Margin = (Revenue − Cost of Goods Sold) / Revenue. Contribution Margin = (Revenue − Variable Costs) / Revenue. Both measure profitability at different levels of cost allocation.
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