Financials

EBITDA

Earnings before interest, taxes, depreciation, and amortization.

What it means

EBITDA is a non-GAAP-style profitability measure in many contexts. It can help compare operating earnings before some financing, tax, and non-cash charges, but definitions can vary.

Example

EV/EBITDA compares enterprise value with EBITDA to create a capital-structure-aware multiple.

What not to infer

EBITDA is not free cash flow and can omit capital spending, working capital, and interest costs.