EBIT margin, also known as EBITDA margin, is a measure of a companys operating efficiency and profitability. It is calculated by dividing EBIT (Earnings Before Interest and Taxes) by revenue and is expressed as a percentage. EBIT margin shows how much of each dollar of revenue was converted into profit, and a higher EBIT margin indicates that the company is making more money on each sale. EBIT margin is a useful measure because it takes into account a companys ability to generate profits from its operations. Unlike EBITDA margin, EBIT margin takes into account depreciation and amortization expenses. EBIT margin is different from operating margin, which measures a companys profit after paying variable costs but before paying interest or tax. The EBIT margin can be used as a comparative benchmark to assess a companys profitability and earning power. The EBIT margin has an array of different user values, including profitability target, reference value, sector comparison, and financing.