EBITDA

Definition

EBITDA stands for Earnings Before Interest Tax Depreciation Amortization, and measures the overall financial performance of a company.

Calculation

EBITDA = Net Income + Interest + Taxes + Depreciation + Amortization

Why is this important?

EBITDA measures a company's profitability and offers a clearer reflection of operations by stripping out expenses that can obscure how the company is really performing."

Financial Glossary Reference

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