![]() ![]() What is the Conceptual Meaning of EBITDA? The widespread usage of the metric is primarily due to the metric being capital structure independent and unaffected by differences in taxes, which is jurisdiction-dependent and can be skewed by items such as net operating losses (NOLs). However, the most common formulas used to calculate the EBITDA metric are as follows.ĮBITDA = EBIT + Depreciation + Amortization Since EBITDA is a non-GAAP measure, there is no standardized, consistent set of rules dictating the specific items that belong in the formula. The only distinction of amortization is that the incremental reduction is applied to the intangible assets belonging to a company across its estimated useful life, as opposed to its tangible, fixed assets.
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