EBITDA-Earnings Before Interest, Taxes, Depreciation and Amortization

EBITDA = revenues - expenses (excluding tax,interest, depriciation).EBITDA is a good metric to evaluate profitability, but not cash flow. EBITDA also leaves out the cash required to fund working capital and the replacement of old equipment, which can be significant.EBITDA can be used to analyze and compare profitability between companies and industries because it eliminates the effects of financing and accounting decisions