# Ebit Margin Calculator

Ebit Margin Calculator is a tool that measures a company’s profit by calculating the Ebit Margin

EBIT Margin:
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Background Information

What does EBIT Margin mean?
The metric called EBIT Margin provides a way to look at a company's profitability without considering its cost of capital or taxes. By dividing EBIT into a company's net revenue, the resulting margin percentage can be easily compared to the margins of other companies in its industry, or to its own past performance to assess how the company has evolved and grown.
Formula
EBIT Margin = EBIT / R

Where:-

• R = sales revenue
Example

A firm has sales of $500000 with an operating cost of$450000, interest paid of $6000 and a tax rate of 30%. According to the formula:- • EBIT = R - E • =$500000 - $450000) • =$50000

Therefore, EBIT Margin is:-

• = EBIT / R
• = ($50000 /$500000) x 100
• = 10%