#685 · Business Tool

EBITDA Calculator

Use this EBITDA calculator to estimate operating earnings before interest, taxes, depreciation, and amortization.

Calculator

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How to use this calculator

Enter revenue, net income, and add-back items. The calculator adds interest, taxes, depreciation, and amortization to net income to estimate EBITDA.

What the result means

EBITDA is often used to compare operating performance before financing, tax structure, and non-cash depreciation or amortization effects.

EBITDA = Net income + interest + taxes + depreciation + amortization. EBITDA margin = EBITDA ÷ revenue × 100.

EBITDA is not the same as cash flow. It excludes working capital changes, capital expenditures, and debt principal payments.

Example calculation

With $75,000 net income, $8,000 interest, $15,000 taxes, $12,000 depreciation, and $5,000 amortization, EBITDA is $115,000.

Tips for better results

  • Use recent numbers rather than optimistic guesses.
  • Run the calculator again after changing price, cost, or conversion assumptions.
  • Treat the result as a planning estimate, not audited financial advice.

FAQ

How do I calculate EBITDA from net income?

Add interest, taxes, depreciation, and amortization back to net income.

What is a good EBITDA margin?

A good EBITDA margin depends on the industry. Higher-margin software and service businesses may have stronger margins than retail or low-margin commerce.

Why do investors care about EBITDA?

Investors use EBITDA to compare operating earnings before financing decisions, tax differences, and certain non-cash expenses.

What is the difference between EBITDA and net profit?

Net profit is after interest, taxes, depreciation, and amortization. EBITDA adds those items back to show a different view of operating performance.

Can a company have positive EBITDA and negative profit?

Yes. A company can have positive EBITDA but negative net profit if interest, taxes, depreciation, amortization, or other expenses are large.

Metric guide

MetricMeaning
EBITDAEarnings before interest, taxes, depreciation, and amortization
EBITDA marginEBITDA as a percentage of revenue
Add-backsItems added back to net income

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