Can EBITDA be negative, and what does that mean?

Yes, EBITDA can be negative. A negative EBITDA indicates that a company’s operational earnings are insufficient to cover its operating expenses, excluding interest, taxes, depreciation, and amortisation. This might occur when a company is in its early stages or undergoing significant investments for growth. A negative EBITDA warrants closer scrutiny to understand the reasons behind it and the company’s growth strategy. Assessing other financial metrics and factors is crucial to determining the company’s overall financial health.

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