About the EBITDA Calculator
This EBITDA calculator turns figures from an income statement into earnings before interest, taxes, depreciation and amortization. Start from net income (adding back interest, taxes, depreciation and amortization) or from operating income/EBIT (adding back depreciation and amortization only) — both routes reach the same number when the inputs are consistent.
EBITDA is used to compare the operating performance of companies with different debt levels, tax situations and asset bases, and it is the earnings figure most buyers, lenders and investors apply multiples to. Enter revenue to see the EBITDA margin, and add one-time or non-operating items (legal settlements, owner perks, restructuring costs) to get adjusted EBITDA.
Keep in mind that EBITDA is a non-GAAP measure: it ignores capital spending, working-capital needs and debt service, so a business with strong EBITDA can still run short of cash. Use it alongside cash flow and net income.
With the default inputs, the ebitda is $340,000.00. Change any value above to recalculate instantly.
How to use the ebitda calculator
- 1Choose whether to start from net income or operating income.
- 2Copy the matching figures from your income statement.
- 3Enter depreciation and amortization (often on the cash flow statement).
- 4Add revenue to get the EBITDA margin.
- 5Optionally enter one-time adjustments to see adjusted EBITDA.
Formula and method
EBITDA strips financing costs (interest), income taxes and non-cash charges for wearing out tangible assets (depreciation) and intangible assets (amortization) out of profit. Starting from net income you add all four back; starting from operating income (EBIT) interest and taxes are already excluded, so only D&A is added.
EBITDA margin is EBITDA ÷ revenue × 100. Adjusted EBITDA adds back one-time, non-operating or owner-specific expenses (and removes one-time gains) to show the recurring earning power a buyer or lender would underwrite.
- EBIT
- Earnings before interest and taxes (operating income)
- D
- Depreciation expense
- A
- Amortization expense
Worked examples
From net income
$200,000 net income + $30,000 interest + $60,000 taxes = $290,000 EBIT. Adding $40,000 depreciation and $10,000 amortization gives EBITDA of $340,000, a 22.7% margin on $1.5M of revenue.
From operating income with add-backs
EBIT of $450,000 plus $100,000 of D&A gives EBITDA of $550,000 (18.3% of revenue). Adding back $50,000 of one-time legal costs lifts adjusted EBITDA to $600,000, a 20% margin.
Net loss but positive EBITDA
A $50,000 net loss plus $40,000 interest is an operating loss of $10,000. Adding back $60,000 of depreciation turns that into $50,000 of EBITDA — a 6.25% margin — showing the loss comes largely from financing and asset costs.
Frequently asked questions
How do you calculate EBITDA?+
Take net income and add back interest expense, income tax expense, depreciation and amortization. Or start from operating income (EBIT) and add depreciation and amortization. Both give the same figure when taken from the same income statement.
What is a good EBITDA margin?+
It depends heavily on the industry. Asset-light software and professional-service firms can exceed 20–30%, while grocery, retail and construction businesses often run in single digits. Compare against peers in your sector rather than a universal benchmark.
What is the difference between EBITDA and adjusted EBITDA?+
Adjusted EBITDA normalizes the figure by adding back one-time or non-recurring items such as lawsuit settlements, restructuring costs or excess owner compensation, and removing one-time gains. It is widely used in business sales and lending covenants.
Is EBITDA the same as cash flow?+
No. EBITDA ignores capital expenditures, changes in working capital, interest and taxes actually paid. Operating cash flow or free cash flow is a better measure of the cash a business generates.
Where do I find depreciation and amortization?+
They may appear as separate lines on the income statement, but are often buried in operating expenses. The cash flow statement lists them as the first add-back in operating activities.
Results are estimates for educational purposes and are not financial advice. Rates, fees and terms vary — confirm with your lender or a licensed advisor before making decisions.