Percent Change vs Percent Difference in Excel

The short answer to percent change vs percent difference: percent change measures how far a value moved from an old figure to a new one, so it has a direction and can be negative. Percent difference compares two values that have no before and after, divides the gap by their average, and is always positive. Using the wrong one makes a report say something you didn't mean. This comparison is for anyone who reports growth, compares stores or teams, or answers percentage questions in an Excel test.

Percent change vs percent difference at a glance#

Percent change asks "how much did it grow?"; percent difference asks "how far apart are these two?".

How to calculate percent change in Excel#

Percent change compares a new value with an old value, as a share of the old value.

=(C2-B2)/B2
=C2/B2-1

If B2 (last year) is 80 and C2 (this year) is 100, both formulas return 0.25. Format the cell as a percentage to see 25%: click Home > Percent Style, or press Ctrl+Shift+% on Windows. The brackets matter in the first formula. Without them, Excel divides first and subtracts second, which gives a wrong answer.

Now swap the direction: from 100 down to 80, the result is -20%. The gap is the same 20 units, but the starting point is bigger, so the percentage is smaller. This is why a 25% rise followed by a 25% fall doesn't bring you back where you started: 80 up 25% is 100, but 100 down 25% is 75.

The guide to the percent change formula covers more variations, including whole columns and negative starting values.

How to calculate percent difference in Excel#

Percent difference compares two values on equal terms. It divides the absolute gap by the average of the two.

=ABS(B2-C2)/AVERAGE(B2,C2)

For 80 and 100, the gap is 20 and the average is 90, so the result is 0.2222, or 22.2%. Swap the values and the answer is the same, because ABS removes the sign and the average doesn't care about order.

Use this when neither value is "before". Two stores, two products, two suppliers' quotes or two lab measurements have no natural starting point, so dividing by either one would favour it.

The same numbers both ways#

Here are two kinds of comparison on similar numbers:

Column D uses =(C2-B2)/B2 and column E uses =ABS(B2-C2)/AVERAGE(B2,C2).

Rows 2 and 3 are time series, so percent change is the right measure: revenue grew 25%, then fell 20%. Row 4 compares two stores. Saying "Store B sold 50% more than Store A" is true, but so is "Store A sold 33.3% less than Store B" (40 / 120). Both are percent changes with different bases. The percent difference, 40%, is the neutral figure that doesn't pick a side.

Notice how close the two measures are for small gaps (row 5) and how far apart they drift for large ones. That makes the choice matter most when values are very different.

Percentage points: a third idea#

When the values are already percentages, there's another measure. If a conversion rate rises from 10% to 12%:

• The change in percentage points is 12% − 10% = 2 percentage points. In Excel: =C2-B2.
• The percent change is (12% − 10%) / 10% = 20%. In Excel: =(C2-B2)/B2.

Both are correct, but "the rate rose 20%" and "the rate rose 2 points" sound very different. Say which one you mean. Percent-of-total reports in pivot tables are another related measure; see percent of total in a pivot table.

When to use percent change#

Use percent change when there is a clear before and after. It fits:

• Growth over time: month-on-month, year-on-year, quarter-on-quarter.
• Price changes: a supplier's price going from 4.50 to 4.95 is a 10% rise.
• Targets vs actuals, when the target is the reference point.
• Budget variance, measuring how far spending moved from the budget.
• Before-and-after tests, such as average handling time before and after a new process, where the earlier figure is the natural base.

If the old value can be zero, guard the formula: =IF(B2=0,"n/a",(C2-B2)/B2). If it can be negative, such as a loss turning into a profit, divide by ABS(B2) so the sign of the result still shows the direction of the move.

When to use percent difference#

Use percent difference when two values are peers. It fits:

• Comparing locations, teams or products in the same period.
• Comparing two quotes or estimates where neither is the "official" figure.
• Checking two measurements of the same thing, such as stock counts by two people.
• Spotting large gaps, such as flagging any pair of figures that differ by more than 10%.

If one value is an accepted or correct figure, such as a known standard, use percent error instead: =ABS(measured-accepted)/accepted, which divides by the accepted value.

Common mistakes with percentages in Excel#

1. Leaving out the brackets. =C2-B2/B2 calculates C2 − 1. Write =(C2-B2)/B2.
2. Dividing by the new value. Percent change always divides by the old value.
3. Using percent change to compare peers. It makes the result depend on which value you pick as the base. Use percent difference.
4. Multiplying by 100 and formatting as %. The cell then shows 2500%. Either multiply by 100 and show a plain number, or format as a percentage, not both. See formatting numbers as currency and percent.
5. Mixing up points and percent. A rate going from 10% to 12% rose 2 points, or 20%.
6. Ignoring zero bases. A zero old value returns #DIV/0!. Handle it with IF.

Our recommendation#

Ask whether the two numbers have an order. If one clearly comes first, such as last year and this year, use percent change, =(new-old)/old, and keep its sign. If they are equals, such as two stores or two quotes, use percent difference, =ABS(a-b)/AVERAGE(a,b). When the values are themselves percentages, state whether you mean percentage points or percent change. Label every percentage column clearly so readers know which one they are looking at.

In short: percent change for before and after, percent difference for side by side.

Practise it#

Try the exercise on this page: calculate the percent difference between two stores with ABS and AVERAGE. Then practise percent change in a live spreadsheet: you type each formula, and it checks your answer instantly.