EBITDA Calculator
Calculate EBITDA and EBITDA margin from net income, interest, taxes, and depreciation & amortization. Educational. Runs in your browser.
Bottom-line profit after everything.
For the EBITDA margin.
EBITDA = net income + interest + taxes + depreciation & amortization. By adding back financing (interest), tax, and non-cash accounting charges (D&A), it approximates a company's core operating cash generation and makes firms with different debt loads, tax situations, and asset bases more comparable. EBITDA margin (EBITDA ÷ revenue) scales it. Note EBITDA is not a substitute for cash flow — it ignores capital expenditure and working-capital needs. Educational; everything runs in your browser.
About this tool
EBITDA — earnings before interest, taxes, depreciation, and amortization — is a measure of profitability that strips out the effects of financing decisions, tax environments, and non-cash accounting charges to focus on how much a company earns from its core operations. The most common way to build it is to start from net income (the bottom line) and add back the four items the acronym names: interest expense (a financing choice, driven by how much debt the company carries), taxes (which vary by jurisdiction and structure), and depreciation and amortization (non-cash charges that spread the cost of past investments in equipment and intangibles across many years). The result approximates the cash a business generates from operating, and because it removes capital-structure and tax differences, it is widely used to compare companies against each other and to value businesses (often as an EV/EBITDA multiple). The EBITDA margin — EBITDA divided by revenue — expresses that operating profitability as a percentage and lets you compare firms of different sizes. EBITDA is popular but not without critics: by ignoring interest and especially capital expenditure, it can flatter capital-intensive or heavily indebted businesses and overstate the cash actually available to owners. It is a starting point for analysis, not a stand-in for free cash flow. This tool also shows EBIT (operating profit, EBITDA minus D&A) for reference. This is educational. Everything runs in your browser; nothing is uploaded.
How to use it
- Enter net income — the bottom-line profit.
- Add back interest expense and taxes.
- Add back depreciation and amortization (non-cash charges).
- Enter revenue to compute the EBITDA margin.
- Read EBITDA, the margin, and EBIT.
Frequently asked questions
- What does EBITDA stand for and how is it calculated?
- Earnings Before Interest, Taxes, Depreciation, and Amortization. Starting from net income: EBITDA = net income + interest + taxes + depreciation + amortization. It approximates core operating earnings before financing, tax, and non-cash charges.
- What is EBITDA margin?
- EBITDA margin = EBITDA ÷ revenue × 100. It shows what share of revenue becomes operating earnings before interest, taxes, and D&A, and lets you compare profitability across companies of different sizes.
- What is the difference between EBITDA and EBIT?
- EBIT (earnings before interest and taxes, or operating profit) still subtracts depreciation and amortization. EBITDA adds those non-cash charges back. EBITDA = EBIT + depreciation + amortization.
- Why is EBITDA used to compare companies?
- Because it removes differences in debt levels (interest), tax jurisdictions (taxes), and asset bases (depreciation/amortization), it makes the underlying operating performance of different companies more directly comparable — which is why valuations often use EV/EBITDA multiples.
- What are the criticisms of EBITDA?
- It ignores interest and capital expenditure, so it can overstate the cash available to a capital-intensive or heavily indebted business. EBITDA is not the same as cash flow and should not be used as a substitute for free cash flow analysis.
- Is anything uploaded?
- No. All calculations run entirely in your browser.