EBITDA removes financing, tax and the non-cash charges for past capital spending, so it compares the earning power of assets rather than the accounting for them. It is the denominator in net-debt-to-ebitda and ev-ebitda and the metric most loan covenants are written against.
The standard criticism is that capital spending is real even if depreciation is non-cash. A company whose machines wear out is not more profitable because the wear is excluded. Treat EBITDA as a leverage and comparison tool, not as cash profit.
Example: Northwind Tools has operating income of $120M plus $64M of depreciation and $11M of amortisation, so EBITDA is $195M. Against $75M of capex, genuine cash generation is far closer to $120M.
Related: operating-income