What does EBITDA stand for?

EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization. It approximates a company's core operating cash flow by removing non-cash charges and financing/tax effects.

How is EBITDA different from operating income (EBIT)?

EBIT (operating income) subtracts depreciation and amortization. EBITDA adds those non-cash charges back, making it a closer proxy to operating cash flow and easier to compare across companies with different asset bases.

What is a good EV/EBITDA multiple?

It depends on the industry and growth rate. Mature, slow-growth sectors (utilities, manufacturing) typically trade at 5–8×. High-growth tech companies can exceed 20×. Always compare against sector-specific benchmarks.

What is EBITDA margin and why does it matter?

EBITDA margin is EBITDA divided by total revenue, expressed as a percentage. It shows what share of revenue turns into operating earnings before non-cash and financing items. Higher margins generally indicate better operational efficiency.

What inputs do I need to calculate EBITDA?

You need operating income (EBIT) plus depreciation and amortization. Alternatively, start from net income and add back interest expense, income taxes, depreciation, and amortization.

EBITDA Calculator

Enter your income statement figures to instantly compute EBITDA, EBITDA margin, and EV/EBITDA valuation multiple.

Income Statement Inputs

Revenue (Net Sales)

Cost of Goods Sold (COGS)

Operating Expenses (SG&A, R&D, etc.)

Depreciation & Amortization (D&A)

Interest Expense

Income Taxes

Enterprise Value (optional — for EV/EBITDA)

Fill in the inputs and click Calculate EBITDA to see results.

EBITDA

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Earnings Before Interest, Taxes, Depreciation & Amortization

EBITDA Margin

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EBITDA ÷ Revenue

EV / EBITDA

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Valuation multiple (requires EV)

Income Statement Bridge

Revenue —

− COGS —

− Operating Expenses —

= EBIT (Operating Income) —

+ Depreciation & Amortization —

= EBITDA —

(from EBITDA)

− Depreciation & Amortization —

− Interest Expense —

− Income Taxes —

= Net Income —

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Summary

The EBITDA Calculator computes earnings before interest, taxes, depreciation, and amortization along with EBITDA margin and enterprise value multiples. Using revenue, operating expenses, depreciation, amortization, interest, and tax inputs, it isolates core operating performance and calculates EV/EBITDA when enterprise value is provided. The metric facilitates cross-company comparison by excluding capital structure and non-cash charges, though it does not reflect capital expenditures or working capital changes.

How it works

Enter your revenue and operating expenses (COGS, SG&A, etc.).
Input depreciation and amortization (D&A) from the cash flow statement.
Add interest expense and total income tax from the income statement.
Optionally enter enterprise value to compute the EV/EBITDA multiple.
Results update instantly — copy any value with one click.

Use cases

Screen acquisition targets by comparing EV/EBITDA multiples across industries.
Benchmark a company's operating profitability against sector peers.
Estimate a private business's value using public-market EBITDA multiples.
Remove non-cash and financing items to compare companies across capital structures.
Prepare for investor conversations with a clean profitability summary.
Validate LBO model assumptions by checking implied entry multiples.

Frequently Asked Questions

Last updated: 2026-06-11 · Reviewed by Nham Vu