EBITDA Calculator

Updated: Feb 12, 2019

EBITDA Calculator is used to calculate the earnings before interest, taxes, depreciation and amortization (EBITDA) of a company


EBIT Calculator

Determine an organization's earnings before interest and taxes (EBIT) expenses

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Background Information

What does EBITDA mean?

EBITDA or Earnings Before Interest, Taxes, Depreciation and Amortization is a metric to find out how efficiently a business is operating.

EBITDA is calculated by subtracting the expenses from the company's revenue. Interest and taxes are excluded from the expenses by adding them back to our calculation. This figure is our EBIT. Adding back depreciation and amortization expenses to EBIT gives us our resultant EBITDA.

EBITDA is a variation of EBIT which does not exclude Depreciation and Amortization from the calculation.

EBITDA Formula (extended)

EBITDA calculation starts with the gross profit. Operating costs such as Costs of goods sold (COGS) are subtracted from the gross profit. Any expenses incurred to raise business capital and tax liabilities is excluded from the calculation. Finally, depreciation and amortization expenses are added back to the calculation.

EBITDA = `r - (c + e) + (d + a)`


  • r = total revenue
  • c = costs of goods sold cogs
  • e = total expenses
  • d = depreciation expense
  • a = amortization expense
EBITDA Formula (simple)

A more simplified way to calculate EBITDA is to utilize Operating Profit (EBIT).

EBITDA = `p + d + a`


  • p = Operating Profit or EBIT
  • i = Depreciation Expenses
  • t = Amortization Expenses

Let's consider Maxotek, a software company. It's yearly income statement is as follows:-

Total revenue$200,000
Costs of goods sold$30,000
Gross profit($170,000)
Operating expenses
Total operating expenses($20,000)
Interests, Taxes, Depreciation & Amortization
Total exclusions($85,000)
Net profit($65,000)

Using the above to calculate EBITDA:-

  • `r - (c + e) + (d + a)`
  • `200000 - (30000 + 20000) + (10000 + 5000)`
  • `200000 - 50000 + 15000`
  • `150000 + 15000`
  • EBITDA = `165,000`

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Comments 0


Feb 12, 2019
Calculation formula breakdown
May 22, 2018
Tool Launched