Net profit margin or net margin is a metric that tells companies how much net income or profit they made as a percentage of total revenue. Net profit margin is expressed as a percentage and illustrates how much of every dollar in revenue earned translates into profit for a company.
Net Profit margin = Net Profit ⁄ Total revenue x 100. Net profit is what's left after deducting expenses from a company's total revenue. For example, if a company's profit margin is 10%, it means that the company earns $0.10 of net profit out of every $1 of revenue.