Divide free cash flow by revenue to see how much of each unit of sales converts into cash.
Margin divides profit by revenue; markup divides the same profit by cost. They are routinely confused, so both are shown — a 50% margin is a 100% markup. Margin is what funds every fixed cost in a business business, and mispricing by a few points is the difference between scaling profitably and scaling losses.
Free Cash Flow Margin
Margin % = (Revenue − Operating costs plus capital expenditure) ÷ Revenue × 100
Margin % = (Revenue − Operating costs plus capital expenditure) ÷ Revenue × 100 Margin divides profit by revenue; markup divides the same profit by cost. They are routinely confused, so both are shown — a 50% margin is a 100% markup.
Margin is what funds every fixed cost in a business business, and mispricing by a few points is the difference between scaling profitably and scaling losses.
This calculator takes 2 inputs: Revenue, Operating costs plus capital expenditure. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.