How did operating earnings move and what drove the change?

MetricEBITDA margin and the drivers of its period-over-period change

Unitpercent of revenue, with bridge steps in percentage points and currency

Waterfall from EBITDA last year plus revenue growth contribution plus gross margin lift minus opex inflation equals current EBITDA. Decompose YoY EBITDA. Reveals whether growth, margin, or cost discipline drove the change. Example: $4.2M PY EBITDA + $2.4M revenue lift + $0.6M margin gain - $1.8M opex = $5.4M.

EBITDA

Earnings before interest, tax, depreciation and amortisation. Operating profit with depreciation and amortisation added back.

YoY

Year on year. This period compared with the same period twelve months earlier.

US listed nonfinancial companies, aggregate sector ratios as of January 2026, cross-checked against the largest 1,000 US listed nonfinancial companies for FY2024 · Damodaran's figures are aggregate ratios, total sector EBITDA divided by total sector revenue, not medians of company-level margins, so they are pulled upward by the largest firms in each sector and the median company usually runs several points lower. Hackett's independent reading of the top 1,000 US listed nonfinancials puts EBITDA margin at 19 percent for 2024, which brackets the Damodaran all-market figure of 17.4 percent excluding financials, so the two agree within the noise their different weightings would predict. Private company EBITDA is not comparable to either: owner compensation, stock-based compensation treatment and capitalised development cost all move the line, and KeyBanc's 16th annual private SaaS survey has private SaaS EBITDA only expected to cross into positive territory in 2026.

The bridge is dominated by a single unlabelled other bar, or the price and volume bars point in opposite directions with volume negative, which means margin held only because the business shrank into its better-priced accounts.

EBITDA margin moves from 14 to 16 percent, made up of plus 3.1 points from price, minus 1.4 points from volume and plus 0.3 from mix, so two thirds of the gain came from selling less at higher prices.

• Force the bridge onto a fixed driver set, price, volume, mix, input cost, operating expense and one-offs, and cap the other bar at 10 percent of total movement. An other bar larger than that means the bridge is a plug, and every conversation it produces will be about the wrong thing.
• Show EBITDA and EBITDA less stock-based compensation as two bars on the same bridge. Damodaran's January 2026 data puts SBC at 7.8 percent of sales for system and application software and 14.9 percent for internet software, which is large enough that the two versions describe materially different companies.
• Add a lease expense line where the business is asset heavy. In the same dataset restaurant and dining runs lease expense at about 5.1 percent of sales and retail special lines at 5.5 percent, enough to invert a peer comparison between a company that leases and one that owns.
• Rebuild the prior-year comparative on the current period's FX rates and show the FX bar separately. For any business with revenue outside its reporting currency, an unbridged FX movement is routinely mistaken for a pricing or cost result and drives a corrective action that was never needed.

1. NYU Stern (Aswath Damodaran)Margins by Sector (US) · 2026 · n=5,994 U.S. listed firms, 4,822 excluding financials, data as of January 2026 Reports EBITDA to sales of 17.42 percent for US listed companies excluding financials as of January 2026, with system and application software at 35.93 percent, business and consumer services at 15.65 percent, general retail at 10.11 percent and grocery and food retail at 5.40 percent, plus stock-based compensation at 7.83 percent of sales for system and application software and 14.87 percent for internet software. pages.stern.nyu.edu ↗
2. The Hackett Group2025 U.S. Working Capital Survey · 2025 · n=top 1,000 U.S. publicly traded nonfinancial companies, FY2024 Reports EBITDA margin climbing to 19 percent, up 6 percent year over year, across the top 1,000 US listed nonfinancial companies in 2024, attributed to cost optimisation, with aggregate revenue up 4 percent. thehackettgroup.com ↗
3. NYU Stern (Aswath Damodaran)Margin and ROIC by Sector (US) · 2026 · n=5,994 U.S. listed firms, data as of January 2026 Reports after-tax operating margin of 12.33 percent for US listed companies excluding financials and 11.88 percent including them, across 5,994 firms as of January 2026. pages.stern.nyu.edu ↗
4. Benchmarkit2025 B2B SaaS Performance Metrics Benchmarks · 2025 · n=~1,000 private B2B SaaS companies, FY2024 data Publishes EBITDA and Rule of 40 benchmarks for private B2B SaaS alongside operating expense ratios of 37 percent sales and marketing, 34 percent R&D and 24 percent G&A at the median. benchmarkit.ai ↗
5. KeyBanc Capital Markets and Sapphire Ventures16th Annual Private Company SaaS Survey · 2025 · private SaaS companies, 16th annual edition, FY2024 and FY2025 expectations Reports private SaaS EBITDA margins improving continuously since 2022 and expected to breach the profitability threshold in 2026. prnewswire.com ↗
6. Sapphire Ventures and KeyBanc Capital MarketsPrivate SaaS Company Survey, 15th annual edition · 2024 · n=more than 100 private global SaaS companies, median ARR about $26M Reports that major profitability metrics improved slightly in 2023 with a more pronounced improvement in 2024 as private SaaS companies focused on operating efficiency and EBITDA margins rather than aggressive growth, across more than 100 companies with median ARR of about $26M. sapphireventures.com ↗
7. The Hackett Group2025 European Working Capital Survey · 2025 · n=1,000 largest European-headquartered nonfinancial companies, FY2024 Reports European aggregate revenue declining for a second consecutive year with total debt as a percentage of revenue rising, which is the margin backdrop against which European EBITDA bridges should be read. thehackettgroup.com ↗