Formula vs Function in Excel – What’s the Difference?

Many Excel users use the terms ‘Formula’ and ‘Function’ interchangeably.

While this does no harm in most cases, it’s good to have a proper understanding of what a formula is and what a function is in Excel.

And, of course, it is going to give you a lot of opportunities to correct others and brag about your own Excel knowledge (if you’re into that kind of fun)

In this article, I will explain the difference between formula and function in Excel (with examples)

What is a Formula in Excel?

Whenever you enter an equal-to sign (=) in a cell in Excel, which is followed by cell references, operators, numbers, etc., it would be considered a formula.

So any equation that you enter into a cell in Excel (that starts with an equal-to sign) would be called a formula.

Below are some examples of Formulas in Excel:


In the above example, I’m using a simple addition operator to add 2 numbers. And since I’m using numbers and an arithmetic operator after the equal to sign, this is a formula


In the example, I have used two cell references to add the values in these two cells. This, again, is your formula


In the above example, I have used the sum function to get the sum of values in the range A1:A10. This, again, is an example of a formula (and interestingly, uses the SUM function)

Advanced Excel Tip: While the norm is to start an excel formula with an equal-to sign, you can also use a + instead of an equal-to sign. However, I would request you to stick to the equal to sign just to avoid any confusion

Also read: Absolute, Relative, and Mixed Cell References in Excel

What is a Function in Excel?

A function is a pre-defined formula in Excel that takes some arguments as the input and gives us the result.

An example of a function in Excel is the SUM function.

The SUM function can take multiple values, multiple cell references, or multiple ranges as the input and would give us the sum of all the values in these input arguments.

For example. =SUM(A1:A10) would give us the sum of all the values within the range A1:A10.

While a cell in Excel can only have one formula, the formula itself can consist of multiple functions.

Below is an example:

=SUM(A1:A10) + AVERAGE(A1:A10)

The above formula uses two functions (SUM and AVERAGE), and it returns a value where it adds the values returned by the sum function and the average function.

Every Excel function has a specific syntax that you need to follow. There are mandatory and optional arguments that can be used in the function, and a specific data type is expected as the resulting output. For example, while the SUM function is expected to return a numeric value, the TEXT function is expected to return a text value. You can find the most common Excel functions and their syntax here

Also read: Excel Skills (Basic, Intermediate, and Advanced)

Difference Between Formula and Function in Excel

Now that you have a good understanding of the difference between a formula and a function in excel, below is the table that will give you a head-on comparison between these two.

Anything you enter in a cell after an equal to sign would be considered a formulaA Function is a predefined formula that takes several arguments and returns a result
One cell can only have one formula in itThe formula in the cell in Excel can have multiple functions
A formula may or may not use any of the functions in ExcelIf you use a function in a cell in Excel, it will always be a part of the formula
A user can design a formula that can use multiple operators as well as multiple functionsA function has a predefined syntax, which specifies the number of mandatory and optional arguments as well as the type of arguments that can be used

If you have gone through the above article, I’m sure you now realize that formula and function are two different things in Excel.

However, you’ll still find that these are used interchangeably by many people in verbal and written communications.

So if you find someone using the terms formula or function incorrectly, feel free to politely correct them (or refer them to this article)

Also read: Remove Formulas (but Keep Data) in Excel

Other Excel articles you may also like:

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Sumit Bansal
Hello there! I'm Sumit Bansal, founder of and an Excel MVP. I started this website in 2013 with a simple goal: to share my love for Excel through easy to follow tips, tutorials and videos. I'm here to help you get the best out of MS Excel to save time and boost your productivity.

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