How to Calculate a Percentage Decrease in Revenue From Year to Year

by C. Taylor

If your revenues have degraded from a previous year, you might want a reliable way to track this decrease. Pure numbers won't do it, because they are meaningless without a reference. As an example a $10,000 reduction might be significant for a very small firm, but if revenues are generally $20 million for a larger business, this reduction is a drop in the bucket. Percentages are a better gauge of how much revenue has been lost compared to the previous year.

Subtract the current year's total revenue from the previous year. If the number is negative, then you know you had a loss. For example, if the current year's revenues were $200,000, but last year they were $250,000, then revenue is down $50,000 from the previous year.

Divide the change in revenue by the previous year's total revenue. In the example, $50,000 divided by $250,000 equals .20.

Multiply this number by 100 to convert the figure into percentage format. In the example, the 0.20 change represents a 20 percent decrease in revenue.