E-commerce Glossary

EBITDA

Earnings before interest, taxes, depreciation, and amortization, a measure of operational performance.

EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) measures a company's operational profitability by excluding the effects of financial structure, taxation, and depreciation accounting choices.

Calculation: EBITDA = Revenue - COGS - Operating expenses (excluding depreciation). It is a proxy for the cash generated by the business before investments and financing.

For an e-commerce, EBITDA is crucial for assessing business health independently of its debt structure. Investors and acquirers often use EBITDA multiples (3x to 8x for an e-commerce) to value a company.

Fullmetrix aggregates your revenue, COGS, and operating expenses to calculate monthly and annual EBITDA, with EBITDA margin tracking (EBITDA / Revenue) over time.

Related terms

AOV (Average Order Value)Average amount spent per order in your store.See definition ARPU (Average Revenue Per User)Average revenue generated per user over a given period.See definition Blended CACAverage acquisition cost including all marketing channels.See definition Blended ROASOverall return on all advertising spend combined.See definition CAC (Customer Acquisition Cost)Total cost to acquire a new customer.See definition Churn RatePercentage of customers lost over a given period.See definition
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