📊 EBIT Calculator
Calculate Earnings Before Interest and Tax (EBIT)
Operating expenses excluding interest and taxes
How to Use This Calculator
Enter Revenue
Input the total revenue - all income from sales, services, or other business activities.
Enter Cost of Goods Sold
Enter the cost of goods sold (COGS) - direct costs of producing goods or services sold.
Enter Operating Expenses
Enter operating expenses - all expenses related to operations, excluding interest and taxes (e.g., salaries, rent, utilities, marketing).
Review EBIT
See the EBIT (earnings before interest and tax) - operating profit before interest and taxes. EBIT shows core operating profitability.
Formula
EBIT = Revenue - COGS - Operating Expenses
EBIT Margin = (EBIT / Revenue) × 100
Example Calculation:
If revenue $1,000,000, COGS $400,000, operating expenses $300,000:
• EBIT = $1,000,000 - $400,000 - $300,000 = $300,000
• EBIT margin = ($300,000 / $1,000,000) × 100 = 30%
About EBIT Calculator
An EBIT (Earnings Before Interest and Tax) calculator helps you calculate operating profit before interest and taxes. EBIT is calculated as Revenue minus COGS minus Operating Expenses. EBIT shows core operating profitability by excluding financing costs (interest) and tax effects, making it useful for comparing operating performance across companies with different capital structures and tax situations. EBIT is an important metric for financial analysis and business valuation.
When to Use This Calculator
- Financial Analysis: Analyze operating profitability
- Business Valuation: Calculate EBIT for valuation
- Performance Comparison: Compare operating performance across companies
- Income Statement: Calculate EBIT for financial statements
Understanding EBIT
- Operating Profit: Profit from core operations
- Excludes Interest: Excludes financing costs
- Excludes Taxes: Excludes tax effects
- Comparability: Useful for comparing operating performance
Why Use Our Calculator?
- ✅ Financial Analysis: Calculate EBIT accurately
- ✅ Business Valuation: Calculate EBIT for valuation
- ✅ Performance Comparison: Compare operating performance
- ✅ Income Statements: Calculate EBIT for financial statements
- ✅ 100% Free: No registration or payment required
Frequently Asked Questions
What is EBIT (Earnings Before Interest and Tax)?
EBIT (Earnings Before Interest and Tax) is operating profit before interest and taxes. It's calculated as Revenue minus COGS minus Operating Expenses. EBIT shows core operating profitability by excluding financing costs (interest) and tax effects, making it useful for comparing operating performance across companies with different capital structures and tax situations. EBIT is an important metric for financial analysis and business valuation.
How is EBIT different from EBITDA and net income?
EBIT excludes interest and taxes, EBITDA also excludes depreciation and amortization, and net income includes all expenses and taxes. The progression is: EBITDA → EBIT (subtract D&A) → EBT (subtract Interest) → Net Income (subtract Taxes). EBIT focuses on operating profitability, EBITDA focuses on cash generation, and net income shows final profit after all expenses.
Why is EBIT important?
EBIT is important because it shows core operating profitability by excluding financing and tax effects. It helps: (1) Compare operating performance - compare companies with different capital structures, (2) Financial analysis - analyze operating profitability, (3) Business valuation - calculate EBIT for valuation, (4) Income statements - calculate EBIT for financial statements. EBIT provides a clearer view of operating performance than net income.
What's a good EBIT margin?
A good EBIT margin depends on your industry and business model. Generally, EBIT margins above 15% are considered good, 10-15% are average, and below 10% may need improvement. Compare to industry benchmarks and historical trends. EBIT margin shows operating efficiency - higher margins indicate better operating efficiency and profitability.