Net Profit is the most comprehensive measure of a company’s financial performance, as it indicates a business’s total earnings after accounting for all costs and expenses incurred over a period of time. It tells you how much money a business has earned by subtracting its total liabilities, costs and expenses from its total revenue.

On the other hand, EBITDA (earnings before interest, taxes, depreciation and amortization) is a measure of a firm’s overall financial performance that strips out items such as taxes or one-time expenses that may obscure results from period to period. It excludes many non-operating items on the income statement and provides a quick snapshot of the operating performance of a business. EBITDA allows investors to focus more on the fundamentals of the operations without the interference of one-time charges or nonrecurring items.