EBITDA measures the operating profit and thus shows the profitability of a business. The key difference between EBIT and EBITDA is that EBIT deducts the cost of depreciation and amortisation from net profit, whereas EBITDA does not.
Alias | Profit before Interest, Taxes, Depreciation, and Amortisation |
Abbreviation | EBITDA |
Unit | Currency (Euro/Dollar/YEN/...) |
Calculation
EBITDA is calculated by deducting all operating and non-operating expenses except interest, taxes, depreciation and amortisation from revenue.
Revenue
- Expenses (interest, taxes, depreciation and amortisation included)
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EBITDA
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Example
The previous year a company had revenue of €440,000 and expenses of €410,000. EBITDA will therefore be €30,000.
€440,000
- €410,000
_________
€30,000
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