EBITDA Calculator

EBITDA = Net Income + Interest + Tax + D&A. Operating earnings before financing + non-cash items.

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Result

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How to use this calculator

  • Get NI, interest, tax, D&A from income statement.
  • Optional: revenue for margin calc.

About this calculator

EBITDA strips out financing decisions (interest), tax jurisdictions, and accounting policy (D&A) to expose pure operating performance. Useful for comparing companies cross-border or with different leverage. Critique: ignores CapEx, working capital — Buffett famously calls it "BS earnings." EBITDA margin > 15% is typical "healthy"; >25% is excellent. Used heavily in private equity (EV/EBITDA multiples for valuation).

Frequently asked

EBIT vs. EBITDA?+
EBITDA adds back non-cash D&A. EBIT is operating income before interest + tax (after D&A).
Why is EBITDA controversial?+
Ignores capital intensity. A telecom with $1B EBITDA but $900M annual maintenance CapEx isn't generating $1B of free cash.
EV / EBITDA multiple?+
Common valuation metric. 8-12× is typical. Higher = growth premium; lower = mature/distressed.
Margin benchmarks?+
SaaS: 20-40%. Industrials: 10-20%. Retail: 5-10%. Banks: not used (different model).
Adjusted EBITDA?+
Add back stock-comp, M&A expenses, restructuring. Used to "smooth" earnings — but can hide ongoing costs. Read footnotes carefully.

Related calculators

Free Cash Flow (FCF)
FCF = EBIT(1−T) + D&A − CapEx − ΔNWC. Cash available to all capital providers.
WACC Calculator
WACC = (E/V)·Re + (D/V)·Rd·(1−T). Blended cost of capital weighted by debt + equity.
Return on Equity (ROE)
ROE = Net Income / Avg Shareholders' Equity. Profitability per dollar of equity.
Return on Assets (ROA)
ROA = Net Income / Avg Total Assets. Profitability per dollar of all assets.
Current Ratio
Current ratio = Current Assets / Current Liabilities. Liquidity benchmark.
Debt-to-Equity Ratio
D/E = Total Debt / Total Equity. Leverage relative to ownership.

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