EBITDA stands for earnings before interest, taxes, depreciation, and amortization. It’s a measure of operating performance that strips out capital structure and non-cash charges.

How is EBITDA calculated here?

EBITDA is calculated as operating profit (EBIT) plus depreciation and amortization. Operating profit is revenue minus COGS and operating expenses.

What is EBITDA margin?

EBITDA margin is EBITDA divided by revenue, expressed as a percentage. It shows how much operating cash-like earnings you generate per dollar of sales before interest, taxes, and non-cash charges.

Does EBITDA replace net profit?

No. EBITDA is one lens on performance. Net profit includes interest, taxes, and non-cash charges and is still critical for overall profitability and valuation.

EBITDA Calculator

Compute EBITDA and EBITDA margin from revenue, expenses, depreciation, and amortization, and compare to operating profit and net profit.

Total revenue ($) Cost of goods sold (COGS) ($) Operating expenses ($)

Depreciation ($) Amortization ($) Interest expense ($)

Tax expense ($) Currency label Period label

Tip: Use EBITDA alongside net profit and cash flow to get a fuller picture of performance.

Important: EBITDA is a non-GAAP metric and should be interpreted carefully. Use it as one tool among many, and consult your accountant or finance team for formal reporting and valuation work.

EBITDA formulas

1. Operating profit (EBIT)

Revenue = R
Cost of goods sold = COGS
Operating expenses = OPEX

Gross profit = GP = R − COGS
Operating profit (EBIT) = EBIT = GP − OPEX

2. EBITDA

Depreciation = DEP
Amortization = AMORT

EBITDA = EBIT + DEP + AMORT

3. Net profit

Interest expense = INT
Tax expense = TAX

Net profit = NP = EBIT − INT − TAX

4. EBITDA margin

EBITDA margin (%) = (EBITDA ÷ R) × 100

Related tools

Net Profit Margin Calculator Break-Even Analysis Calculator

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