EBITDA is Bullsh*t

Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) is a metric that measures a company's profitability by ignoring debt, taxes and non-cash charges like depreciation and amortization. It shows how much cash a business is generating and is not required for publicly listed companies.

Depreciation is the practice of spreading out the cost of a physical asset over its lifetime while amortization is the same concept for non-physical assets. EBITDA is not a universally accepted metric and can vary between businesses.

EBITDA is a financial term created by John Malone, a telecom investor, to show fake profits. John didn't like paying taxes and inflated his investments to lower them. Now, everyone uses it to fool banks and investors.

In a way EBITDA is a fake metric used to deceive creditors. It was created to lower taxes and obtain additional loans, a process now widely used by finance people.