What is contribution margin?

Contribution margin = Selling price per unit − Variable cost per unit. It represents the portion of revenue that contributes to covering fixed costs and generating profit.

Contribution Margin Calculator

Calculate contribution margin, CM ratio, and contribution margin per unit from revenue and cost inputs.

This tool runs in your browser. None of your data is saved or sold.

Revenue ($)

Variable costs ($)

Fixed costs ($)

Units sold

About This Calculator

Contribution margin is what remains from revenue after variable costs — it's the amount each unit of sales 'contributes' to covering fixed costs and then to profit. A high CM ratio means each sale generates a lot of coverage; a low ratio means you need high volume to reach profitability.

Estimates only — not financial, tax, legal, or investment advice. Verify important results with a qualified professional before making decisions.

contribution margin = revenue − variable costs; contribution margin ratio = contribution margin ÷ revenue × 100; contribution margin per unit = contribution margin ÷ units sold