Revenue Growth Rate Formula

“Revenue” is defined as gross income, or the total amount of money received for the sale of goods and services before any expenses are deducted. Be aware that revenue can be misleading since it doesn’t take into account any business liabilities, and associated direct or indirect expenses/costs.

Revenue Growth Rate = {Total Revenue for a Period minus Total Revenue for Prior Period} x 100

For example: If the Gross Revenue in Year 1 and Year 2 was $2,000,000 and $2,400,000, respectively, then Revenue Growth Rate in year 2 would be: $2,400,000 – $2,000,000 = $400,000 and $400,000 / $2,000,000 = .20 X 100 = 20 Percent Revenue Growth Rate.

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