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The "E" in EBITDA stands for earnings - what particular distinction did you see between EBITDA and the earnings you're talking about? Completely off-topic, I r
by s_Hogg 7y ago
The "E" in EBITDA stands for earnings - what particular distinction did you see between EBITDA and the earnings you're talking about?
Completely off-topic, I read somewhere recently that EBITDA could also stand for "Earnings Before I Tricked the Dumb Auditor".
- H8crilA 7y agoHe should have written revenue. It is how the IPOs are priced these days (YY times yearly revenues, with YY in the range of 15-25). It is a pretty useless way of valuing companies. While we're here it is worth remembering that unlike most of today's "rising stars", most of the established tech giants were profitable at IPO time (Google, Facebook, Apple, Microsoft).
- arcticbull 7y agoCorrect I meant revenue
- TeMPOraL 7y agoIANAAccountant, but if we have a term "Earnings Before ...", then presumably "Earnings" means whatever money there is left after you subtract all the "..." from it.
- juped 7y agoEBITDA is non-GAAP and needs to come with a disclaimer but it's pretty common and everyone's used to it. The point of it is to isolate the underlying operating profit without the complicating details of capital structure, tax regime, or capex. Things like WeWork's "community-adjusted EBITDA" read like punchlines, though.