What is Earnings Before Income and Taxes (EBIT) & How To Use The Metrics
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Earnings before interest and taxes (EBIT) is a company's net income before income tax expense and interest expenses are deducted.
Why are earnings before interest and taxes (EBIT) important?
EBIT is important because it provides insight into a company's operational profitability without the influence of financing and tax decisions.
An easy way to understand earnings before interest and taxes (EBIT) is:
To think of it as the money a company makes from its core business operations, before considering the costs of borrowing money or paying taxes.