| Earnings Before Taxes (EBT) | Earnings Before Interest & Taxes (EBIT) | Earnings Before Interest, Taxes, Depreciation & Amortization (EBITDA) | |
| Formula | Revenue - COGS - Operating Expenses - Other Expenses + Other Income | Revenue - COGS - Operating Expenses | Revenue - COGS - Operating Expenses + Depreciation + Amortization |
| Operational Insight | Insight into profitability before tax | View of operating profitability excluding financing costs | Rough measure of cash flow by adding back Depreciation and Amortization to EBIT |
| Distance from Net Income | Close to net income, excluding only taxes | Excludes effects of financing and taxes from operating profitability | Excludes effects of depreciation and amortization from EBIT |
| Uses and Applications | Analyzing profitability and tax strategy | Operating analysis, valuation, and company comparison | Valuation, investor analysis, and company comparison |
| Taxation and Financing | Highlights impact of taxation, not financing on total earnings | Ignores tax and financing impacts, focusing on operating earnings | Ignores impact of taxation, financing, depreciation, and amortization on operating earnings |
| Key Formulas | - Net Income = EBT - Taxes - Effective Tax Rate = (Taxes ÷ EBT) × 100 | - Interest Coverage Ratio = EBIT ÷ Interest Expense - Return on Capital Employed = EBIT ÷ (Total Assets - Current Liabilities) | - EBITDA Margin = (EBITDA ÷ Revenue) × 100 - EV to EBITDA = Enterprise Value ÷ EBITDA |