Industrial gas turbines show performance characteristics that distinctly depend on ambient and operating conditions. They are not only influenced by site elevation, ambient temperature, and relative humidity, but also by the speed of the driven equipment, the fuel, and the load conditions. Proper application of gas turbines requires consideration of these factors. This tutorial explains these characteristics based on the performance of the engine compressor, the combustor and the turbine section, and certain control strategies. It introduces fundamental concepts that help to understand the flow of energy between the components. Additionally, methods are introduced that allow the use of data for trending and comparison purposes. The impact of component degradation on individual component performance, as well as overall engine performance is discussed, together with strategies to reduce the impact of degradation.