Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)

A company’s earnings before accounting for interest, taxes, depreciation, and amortization expenses, used as an indicator of operating profitability and cash flow generation.

For example, if a company has $2 million in net income, $500,000 in interest and tax expenses, and $1 million in depreciation and amortization, its EBITDA would be $3.5 million.