Profitability guide
How to use the ebitda calculator
Worked example
EBITDA: calculation example
$50,000 operating profit plus $8,000 depreciation and $2,000 amortization gives $60,000 EBITDA, assuming those charges were deducted in operating profit.
EBITDA is not cash flow. It does not account for capital spending, debt payments, or changes in working capital; compare it with net income and the cash flow statement.
Common question
Understand the result
Can EBITDA be used as cash available to spend?
No. It does not deduct debt principal, interest, taxes, capital expenditure, or working-capital requirements. Review the cash flow statement alongside it.