EBITDA Calculator – Evaluate Business Profitability Instantly
This free EBITDA Calculator helps you determine your business’s Earnings Before Interest, Taxes, Depreciation, and Amortization in seconds. It’s an essential financial tool used by entrepreneurs, investors, analysts, and CFOs to assess core profitability.
What is EBITDA?
EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization. It shows the operational earnings of a business without the influence of financial and accounting decisions. This makes it ideal for comparing profitability across companies and industries.
EBITDA Formula:
EBITDA = Net Income + Interest + Taxes + Depreciation + Amortization
Why is EBITDA Important?
- 🔍 Strips out accounting differences (depreciation/amortization) for cleaner comparisons
- 📊 Used in business valuations, pitch decks, and due diligence
- 💰 Helps investors understand operational earnings without financial noise
- 📉 Ideal for startups, small businesses, and corporations alike
Frequently Asked Questions (FAQs)
Q1: Is EBITDA the same as profit?
No. Profit (net income) includes interest, taxes, depreciation, and amortization, while EBITDA removes them to show raw earnings power.
Q2: Can I use EBITDA to value my business?
Yes. EBITDA is commonly used in valuation multiples like EV/EBITDA for mergers, acquisitions, and startup fundraising.
Q3: Should startups track EBITDA?
Absolutely. EBITDA helps startups highlight their operational performance before financial and tax complexities enter the picture.
Q4: What’s the difference between EBIT and EBITDA?
EBIT excludes interest and taxes, but **includes** depreciation and amortization. EBITDA removes all four.