Break-even Calculator
Find the units you must sell to break even.
Costs that don't change with volume (rent, salaries).
Results update as you type.
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How it works
The break-even point is the sales volume at which total revenue exactly equals total costs, so the business makes neither a profit nor a loss. The units figure shown here is how many you must sell just to cover everything, and it matters because it converts a wall of fixed and variable costs into a single, concrete sales target you can plan and push toward. This break-even calculator subtracts the variable cost per unit from the price to find the contribution margin — the amount each sale contributes toward fixed costs — then divides your fixed costs by that margin. The method works because fixed costs stay flat no matter how much you sell, while each unit chips away at them by its contribution, so once enough units have sold to cover the fixed block, the next sale turns profitable. A break-even calculator underpins cost-volume-profit analysis, the framework businesses use to test pricing, plan production and decide whether a product is viable. Founders, product managers and finance teams reach for a break-even calculator when launching a product, setting a price, or evaluating whether higher fixed costs — new equipment, more staff — can be justified by the extra volume needed. If the price does not exceed the variable cost, no volume ever breaks even and there is no answer.
Break-even units = fixed costs ÷ (price − variable cost)
Fixed costs are expenses that do not change with volume, and the contribution margin is the price minus the variable cost of one unit — the money each sale frees up after covering its own variable cost. Dividing fixed costs by that per-unit contribution counts how many units are needed to absorb the entire fixed block. If price is at or below variable cost, the contribution is zero or negative, so no number of units can ever cover fixed costs.
Source:Standard break-even (cost-volume-profit) analysis
We review all our tools from time to time to ensure accuracy.
Worked example
How to use this calculator
- 1
Enter your values
Enter fixed costs, price per unit and variable cost per unit.
- 2
Adjust the options
Fine-tune any options to match your situation.
- 3
Read your result
Break-even units updates instantly as you type — no button to press.
Frequently asked questions
What is the difference between fixed and variable costs?
Fixed costs stay the same no matter how much you sell — rent, salaries, insurance, software subscriptions and loan payments all fall here. Variable costs rise and fall directly with volume, such as raw materials, packaging, shipping, payment processing fees and hourly production labor. Sorting your costs correctly is essential, because break-even depends on it. Some costs are mixed, like a utility with a base charge plus usage; split those into their fixed and variable parts for accuracy.
What is contribution margin?
It is the selling price of one unit minus its variable cost — the money each sale contributes toward covering fixed costs and, once those are covered, toward profit. In the example, a $40 price and $15 variable cost leave $25 of contribution per unit. A higher contribution margin means fewer units are needed to break even. It is one of the most useful figures in pricing, because it shows exactly how much each additional sale is worth to the business.
What happens if the price is below variable cost?
Then every unit sold loses money before fixed costs are even considered, so no sales volume can ever break even. The contribution margin is zero or negative, and the calculator returns no result until the price exceeds the variable cost. If you find yourself here, you must raise the price or cut the variable cost per unit. Selling below variable cost only makes sense briefly as a loss leader to win customers you monetize elsewhere.
How do I calculate a break-even point in revenue?
Multiply the break-even units by the price per unit, which the tool does for you. In the example, 400 units at $40 gives $16,000 of break-even revenue. Alternatively, divide fixed costs by the contribution margin ratio — the contribution margin divided by the price. The revenue figure is handy when you think in sales dollars rather than unit counts, or when a business sells many products and unit-level tracking is impractical.
How does break-even help set prices?
It shows the sales target every candidate price implies. Raise the price and the contribution margin grows, so fewer units break even, but demand may soften. Lower the price and you need more volume to cover fixed costs. By testing prices against a realistic sales forecast, you find the level that breaks even at an achievable volume while leaving room for profit. It also reveals when a proposed increase in fixed costs demands an unrealistic jump in sales.