Break-Even Calculator — Units, Revenue & Target Profit
Enter your fixed costs for a period, what one unit sells for, and what one unit costs to make and deliver. The calculator returns the contribution margin each sale makes toward fixed costs, the units and revenue needed to break even, and — if you add a profit target — the volume that clears it. Add your actual sales volume to see the profit at that level and how far sales could fall before the period turns a loss.
Costs and price
Per period: rent, salaries, software.
What one unit sells for.
Materials, shipping, payment fees.
Goals (optional)
Profit you want above break-even, same period.
Adds profit at that volume and the margin of safety.
Break-even
Enter fixed costs, a price per unit, and a variable cost per unit to see the break-even point.
Design the pricing page these numbers justify
Turn the pricing decision into a page, one-pager, or deck on a Moda canvas.
Try Moda free →Contribution margin is the whole calculation
Break-even is one division: fixed costs divided by the contribution margin, which is price minus variable cost per unit. Everything else on this page is a variation on that. The framing matters more than the formula, though — contribution margin is what each individual sale hands you toward the costs you owe whether you sell anything or not. A $79 product with $31 of variable cost contributes $48 a sale, so $48,000 of fixed costs takes 1,000 units. Doubling the price does far more than halving the variable cost, because price moves the margin dollar for dollar while a cost cut only moves the part of it you were spending.
Getting the split between fixed and variable right
The two categories are decided by one question: does this cost change when you sell one more unit? Materials, shipping, payment processing, per-seat software passed through to a customer, and sales commission are variable. Rent, salaried staff, insurance, and your own tooling are fixed. Two costs reliably get mis-filed. Payment fees are variable and often forgotten, which quietly overstates contribution margin by two to three percent of price. And "semi-variable" costs — a support team that grows in steps, warehouse space you add a pallet at a time — are neither, and the usual practical answer is to treat them as fixed within the volume range you are actually modelling and to re-run the numbers when you approach the step.
When there is no break-even point at all
If the variable cost per unit meets or exceeds the price, no sales volume ever covers fixed costs — each sale adds to the loss rather than reducing it, and selling more makes things strictly worse. The correct output there is "never", and that is what this page shows rather than a very large unit count produced by dividing by something near zero. It is a common state for early-stage hardware, marketplaces subsidising both sides, and anything sold below cost to buy market share; it is a deliberate strategy or a pricing error, but either way volume is not the fix.
Break-even units round up, revenue does not
The exact break-even volume is almost never a whole number, and you cannot sell 0.4 of a unit — so the unit figure is always rounded up to the next whole unit, which means the whole-unit volume clears break-even by a few dollars rather than landing exactly on it. Break-even revenue is calculated from the exact volume (fixed costs divided by the contribution margin ratio) rather than from the rounded unit count, so it is the true zero-profit revenue line. Both figures are shown, along with the exact unrounded volume, so nothing about the rounding is hidden. This is arithmetic on the numbers you enter and is not accounting or financial advice — real cost structures rarely fit three fields.
Frequently asked questions
How do you calculate the break-even point?
Divide fixed costs by the contribution margin per unit, which is price minus variable cost per unit. $48,000 of fixed costs with a $48 contribution margin breaks even at 1,000 units. For the revenue version, divide fixed costs by the contribution margin ratio (contribution margin ÷ price) instead.
What is contribution margin, and is it the same as gross margin?
Contribution margin is price minus variable cost per unit — what one sale contributes toward fixed costs and then profit. It is closely related to gross margin but not identical: gross margin is defined against cost of goods sold, while contribution margin includes every cost that varies with volume, including ones accountants place below the gross-profit line such as sales commission and payment fees.
How many units do I need for a specific profit?
Add the profit target to fixed costs and divide by the contribution margin: (fixed costs + target profit) ÷ contribution margin. Enter a target profit above and the figure appears with the revenue it implies. The profit target is treated as pre-tax.
What is the margin of safety?
How far sales can fall from their current level before you stop covering costs, as a percentage of current sales. Selling 1,400 units against a 1,000-unit break-even is a 28.6% margin of safety: a 28.6% drop in volume takes you to zero profit. A negative value means current volume is already below break-even.
Does this handle multiple products?
Not directly — it models one price and one variable cost. For a multi-product business the standard approach is a weighted-average contribution margin across your actual sales mix, entered here as a single blended price and variable cost. That result is only as good as the mix assumption, and it stops being true the moment the mix shifts.