EBITDA Calculator
Calculate Earnings Before Interest, Tax, Depreciation & Amortization to analyze operational efficiency
Calculate Earnings Before Interest, Tax, Depreciation & Amortization
Operating Profit + Depreciation & Amortization
Earnings before interest and taxes
Annual depreciation of tangible assets
Annual amortization of intangible assets
EBITDA Results
Enter your financial data to calculate Earnings Before Interest, Tax, Depreciation & Amortization
Example: Technology Company EBITDA Calculation
Tech Company Financial Data
Operating Profit (EBIT): $100,000
Depreciation Expense: $20,000
Amortization Expense: $5,000
Total D&A: $25,000
EBITDA: $125,000
Cash Flow Strength: Strong
Step 1: Input Values
Operating Profit: $100,000
Depreciation: $20,000
Amortization: $5,000
Step 2: Calculate D&A
$20,000 + $5,000
= $25,000
Step 3: Calculate EBITDA
$100,000 + $25,000
= $125,000
Result: The company's EBITDA is $125,000, showing strong operational cash generation. This metric excludes non-cash charges (D&A) and provides a clearer view of cash-generating capability.
EBITDA vs Other Metrics
EBITDA
Before interest, tax, depreciation, and amortization
Highest earnings figure, shows cash generation
EBIT
Before interest and tax
Operating profit including D&A
EBT
Before tax only
Pre-tax profitability
Net Income
After all expenses including tax
Bottom line profit
Why Calculate EBITDA?
Cash flow analysis: Shows operational cash generation without non-cash charges
Company valuation: Key metric for enterprise value and EBITDA multiples
Pure operations: Focus on core business performance excluding financing effects
Fair comparison: Compare companies with different capital structures and accounting methods
Understanding EBITDA (Earnings Before Interest, Tax, Depreciation & Amortization)
What is EBITDA?
EBITDA is very similar to EBIT. In simple words, this is the same as EBIT but expanded by amortization and depreciation. EBITDA is made to measure the operating profit of a given company before deduction of interest, taxes, and depreciation and amortization. It makes it possible to rate the real capabilities of companies and also compare them, even if they operate in different tax systems or have different financial strategies.
EBITDA Formula
EBITDA = Operating Profit + Depreciation + Amortization
Or: EBITDA = EBIT + Depreciation + Amortization
Key Components
Operating Profit (EBIT)
Earnings before interest and taxes
Depreciation
Non-cash charge for tangible asset wear and tear
Amortization
Gradual lowering of intangible asset value over time
EBITDA Multiple
Enterprise value ÷ EBITDA for company valuation
Benefits of EBITDA Analysis:
- ✓Shows pure operational cash generation capability
- ✓Eliminates non-cash accounting effects
- ✓Useful for debt capacity and leverage analysis
- ✓Key metric for M&A and valuation purposes
Industry Applications:
- •Private equity and venture capital analysis
- •Credit analysis and debt covenant monitoring
- •Enterprise valuation and EBITDA multiples
- •Operational performance benchmarking