# EBITDA Margin Calculator

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## What is EBITDA Margin Calculator?

An EBITDA Margin Calculator is a tool used by businesses to calculate their EBITDA margin percentage, which measures profitability. This calculator takes the total earnings before interest and tax (EBITDA) and subtracts associated costs (AC) to calculate the EBITDA margin. Here’s everything you need to know about the formula, calculation, and frequently asked questions (FAQs) about the EBITDA Margin Calculator.

### Formula

The formula for calculating EBITDA Margin is:

EBITDA Margin (%) = (EBITDA – AC) / EBITDA * 100

where EBITDA is the total earnings before interest and tax, and AC is the associated costs.

### Example:

Let’s say a business has a total EBITDA of $100,000 and associated costs of $25,000. The EBITDA Margin would be:

EBITDA Margin = ($100,000 – $25,000) / $100,000 * 100 = 75%

This means that for every dollar of revenue generated, the company earns 75 cents in profit before interest, taxes, depreciation, and amortization.

### Calculation

To use the EBITDA Margin Calculator, input the total earnings before interest and tax (EBITDA) and associated costs (AC) into the form. Then, click the “Calculate” button to find the EBITDA Margin percentage. The result will be displayed in a paragraph element on the page.

### FAQs

**What is EBITDA?**

EBITDA stands for earnings before interest, taxes, depreciation, and amortization. It is a measure of a company’s profitability before accounting for non-operating expenses, capital expenditures, and taxes.

**Why is EBITDA Margin important?**

EBITDA Margin is important because it provides a measure of a company’s profitability that is not influenced by its capital structure or tax environment. This makes it a useful tool for comparing the profitability of different companies or evaluating the performance of a single company over time.

**What is a good EBITDA Margin?**

A good EBITDA Margin varies by industry and company size. Generally, a higher EBITDA Margin is better, as it indicates that a company is more profitable. However, a company with a very high EBITDA Margin may be underinvesting in its business or taking on too much debt.