Net Income
The company's final profit after operating expenses, interest and taxes have been deducted.
Business Performance Calculator
EBITDA Calculator
Calculate earnings before interest, taxes, depreciation and amortization using either net income or operating income.
Enter Your Financial Information
Select a calculation method and enter values from your income statement.
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Profit remaining after all business expenses.
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Also known as EBIT or operating profit.
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Please enter the required financial information.
What Is EBITDA?
EBITDA stands for earnings before interest, taxes, depreciation and amortization. It is a financial performance measurement that focuses on the earnings generated by a company's main business operations.
By removing financing costs, tax expenses and certain non-cash accounting charges, EBITDA can make it easier to compare the operating performance of different businesses.
Why Businesses Calculate EBITDA
Business owners, analysts, investors and lenders commonly use EBITDA to review operating profitability, compare companies and evaluate the ability of a business to generate earnings from its normal activities.
What the Calculator Includes
Each input represents an important part of the EBITDA calculation.
Interest Expense
The cost of loans, credit facilities and other borrowed funds used by the business.
Income Taxes
The income tax expense recorded by the company for the selected accounting period.
Depreciation
The accounting expense used to allocate the cost of physical assets over their useful lives.
Amortization
The accounting expense used to spread the cost of intangible assets over time.
Operating Income
Profit earned from normal business operations before interest and income taxes.
How to Use the EBITDA Calculator
Calculate EBITDA from your financial statement in four straightforward steps.
Select a Method
Choose the net income method or the operating income method.
Select Currency
Choose the currency used in your company's financial accounts.
Enter Financial Data
Add the required earnings, expenses and non-cash accounting charges.
View Your Result
Click the calculate button to see EBITDA and its calculation breakdown.
EBITDA Formulas
The correct formula depends on the starting value available in your financial records.
Net Income Formula
EBITDA = Net Income + Interest + Taxes + Depreciation +
Amortization
Use this formula when your income statement provides net income and the individual adjustment amounts.
Operating Income Formula
EBITDA = Operating Income + Depreciation + Amortization
Use this formula when you already know operating income, which is also commonly referred to as EBIT.
Example EBITDA Calculation
Suppose a company reports net income of $250,000, interest expense of $20,000, income tax expense of $45,000, depreciation of $15,000 and amortization of $10,000.
EBITDA = $250,000 + $20,000 + $45,000 + $15,000 + $10,000
= $340,000
Based on these figures, the company's estimated EBITDA is $340,000 for the selected accounting period.
EBITDA vs Net Income
Net income represents profit after all recorded expenses. EBITDA adds interest, tax, depreciation and amortization expenses back to net income. For this reason, EBITDA is normally higher than net income when these expenses are positive.
EBITDA vs Operating Income
Operating income generally includes depreciation and amortization expenses. EBITDA adds these non-cash expenses back to operating income to provide a different view of operating performance.
Frequently Asked Questions
Common questions about EBITDA and business performance calculations.
EBITDA stands for earnings before interest, taxes, depreciation and amortization.
EBITDA can be calculated by adding interest, taxes, depreciation and amortization to net income. It can also be calculated by adding depreciation and amortization to operating income.
No. EBITDA is a performance measurement that excludes selected expenses. Net profit includes interest, taxes, depreciation, amortization and other applicable costs.
Yes. Negative EBITDA normally indicates that a company's core operations did not generate enough earnings to cover operating expenses during the selected period.
Yes. Normal operating costs such as salaries, rent, utilities and marketing expenses are generally deducted before EBITDA is determined.
No. EBITDA is not the same as cash flow because it does not directly account for working capital changes, capital expenditure, debt payments and other cash movements.
Most values can be found in the company's income statement, profit and loss statement, cash flow statement or supporting accounting schedules.
Adjusted EBITDA removes additional unusual, non-recurring or non-operating items. The exact adjustments can differ between companies, so they should always be reviewed carefully.
Important:
This calculator provides an estimate based on the information
entered. Review official financial statements and consult a
qualified accounting or financial professional before making
important business, lending or investment decisions.