How to Calculate Return on Investment (ROI)

Return on investment (ROI) is the ratio of money earned or lost on an investment relative to the amount of money invested.  ROI is typically expressed as a percentage rather than a decimal value, and is based on returns over a period of time (most often stated for one calendar or fiscal year).

Here's the basic calculation for determing Return on Investment (ROI):

ROI = (Revenue - Costs) / Costs

To get the ROI as a Percentage, multiple by 100:

ROI = [(Revenue - Costs) / Costs] * 100 

As an example, lets say "Company A1" earns $1,000 in revenue, and has costs of $750.  Company A1's return on investment would be 33.3%.