What is Earned Value (EV)?
Earned Value is the budgeted worth of the work actually completed — not what you spent, but what the finished work was supposed to cost. It's the anchor of every EVM calculation: compare EV to planned value and you get schedule performance; compare it to actual cost and you get cost performance.
The classic mistake is confusing EV with money spent. Spending $50,000 doesn't mean you've earned $50,000 of value — sometimes it means you've earned far less, and that gap is exactly what EVM exists to expose.
Formula
EV = Actual % complete × BAC
Worked example
Same $100,000 project: the team has genuinely completed 35% of the work. EV = 35% × $100,000 = $35,000 — regardless of what you spent to get there.