Operating Cash Flow

Benzinga  Sep 6  Comment 
Shares of MeetMe Inc (NASDAQ: MEET) traded higher after the company announced a fresh share buyback program of a maximum of $15 million. The company will fund the buyback program from cash from operations. At the end of August, MeetMe had...
Reuters  Jul 29  Comment 
* Revising 2016 guidance for cash flow from operations to a range of $104 million to $135 million, due to acquisition of afsc
Automotive World  Jul 26  Comment 
BP today reported that profit for the second quarter of 2016 was $720 million on an underlying replacement cost basis1, compared with $532 million for the previous quarter and $1.3 billion for the second quarter of 2015. Underlying operating cash...
Yahoo  Jun 28  Comment 
Corporate cash is at historically high levels as increased debt is offsetting net operating cash outflows.
Benzinga  May 6  Comment 
Cogentix Medical Inc (NASDAQ: CGNT) reported lower-than-expected 1Q16 revenues and GAAP net loss, but its operating cash generation was positive for the second consecutive quarter. Roth Capital Partners’ Chris Lewis downgraded the rating for the...
Forbes  Apr 25  Comment 
Net operating profit after-tax (NOPAT) is the unlevered, after-tax operating cash generated by a business. It represents the true, normal and recurring profitability of a business. GAAP earnings or, even worse, non-GAAP earnings, are highly...
Motley Fool  Nov 9  Comment 
Revenue and cash from operations barely budge as fewer pay up for the company's enterprise technology. Investors sent the stock up right after the quarterly report.
Automotive World  Nov 5  Comment 
Strong financial performance Sales of $808 million Adjusted EBITDA of $65 million; net income of $5 million Cash from operations of $70 million, adjusted free cash flow of $77 million Electronics & Corporate performance Electronics Sales of $771...


Operating Cash Flow is the total cash generated from the operations of a company

Operating Cash Flow (alternately "Cash Flow from Operating Activities", or "Cash Flow from Operations") is a measure (listed on the Cash Flow Statement) of the total cash generated from a company's operations. Though there are several ways to perform the actual calculation, most start with the net income (from the income statement), add depreciation, and adjust for changes in working capital (e.g. changes in liabilities, inventories, accounts receivable etc.).

Operating Cash Flow tells how much cash a company has been able to generate from the operations of its business. Since it adjusts for liabilities, receivables, and depreciation it is a more accurate measure of how much cash a company has generated (or used) than measures of profitability such as net income. As such, a massive and/or unexpected discrepancy between the net income and operating cash flow of a company could be indicative of disproportionate non-cash income. For example: A company with a lot of machinery (fixed assets) may have low net income due to depreciation; however the company does not pay for depreciation with cash, and, assuming everything else remains the same, the operating cash flow for the company would be higher than its net income.

The management has far less discretion over the cash flow statement than it does over the income statement -- as a result some investors may find it to be a better reflection of reality than the income statement. Also, given that companies require cash to run its everyday operations, cash flow from operations are likely to highlight any liquidity issues that a company might have.


Rogers Widget company had net income of $500 in 2008. The company has a capital extensive business (think lots of big heavy machinery) and in 2008 it had depreciation expense of $300. Since depreciation doesn't actually require that the company pay out anything in cash, the company has to add back this expense in order to come up with operating cash flow. In 2008, the company generated $800 in cash flow from operations.

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