Non-operating activities include interest expenses, tax rates, and large non-cash items such as depreciation and amortization. By removing the non-operating effects, EBITDA gives investors the ability to focus on the profitability of their operations.
Thomas Edison once speculated: Genius is one percent inspiration and ninety-nine percent perspiration.
A century later, it still serves the original marketing purpose of developing and protecting Edison's brand as the World's Greatest Inventor. Genius is one percent inspiration and 99% perspiration.