EBITDA Calculator

Use this calculator to estimate EBITDA.

What this calculator does

The EBITDA calculator helps measure earnings before interest, taxes, depreciation, and amortization.

It is useful for:

• business valuation
• financial analysis
• performance comparison
• lending discussions

Formula

EBITDA = Operating Profit + Depreciation + Amortization

Where:

• Operating Profit = profit from operations
• Depreciation = non-cash depreciation expense
• Amortization = non-cash amortization expense
• EBITDA = earnings before interest, taxes, depreciation, and amortization

Example calculation

If:

• Operating profit = 40000
• Depreciation = 5000
• Amortization = 3000

Then:

• EBITDA = 40000 + 5000 + 3000
• EBITDA = 48000

What is EBITDA?

EBITDA is a profitability metric that removes financing, tax, and certain non-cash accounting effects.

Why EBITDA matters

This calculation helps businesses:

• compare companies more easily
• assess operating performance
• support valuation
• review cash-style earnings

When to use this calculator

Use this calculator when you want to:

• compare business performance
• prepare for valuation
• review operating earnings
• discuss funding

Common mistakes

Common mistakes include:

• treating EBITDA like cash flow
• using the wrong operating profit figure
• leaving out depreciation or amortization
• comparing businesses with very different capital structures

EBITDA vs operating profit

These are closely related.

• EBITDA adds back depreciation and amortization
• Operating profit does not

Related calculations

You may also want to use:

• Operating Profit Calculator
• Cash Flow Calculator
• Depreciation Calculator

FAQs

What does this calculator do?

It helps you calculate EBITDA.

Why is EBITDA important?

It helps compare businesses by focusing on operating earnings before certain accounting and financing effects.

Is EBITDA the same as cash flow?

No. EBITDA is not the same as actual cash flow.