💰 Free Cash Flow Calculator
Calculate free cash flow (FCF)
Cash flow from operating activities
Cash spent on fixed assets (property, plant, equipment)
How to Use This Calculator
Enter Operating Cash Flow
Input the operating cash flow from the cash flow statement - cash flow from operating activities.
Enter Capital Expenditures
Enter the capital expenditures (CapEx) - cash spent on fixed assets like property, plant, and equipment. Note: CapEx is typically a negative number in cash flow statements, but enter it as a positive value here.
Review Free Cash Flow
See the free cash flow (FCF) - the cash available after maintaining or expanding assets. Positive FCF indicates the company has cash available for dividends, debt repayment, or investments.
Formula
Free Cash Flow (FCF) = Operating Cash Flow - Capital Expenditures
Example Calculation:
If operating cash flow $500,000, capital expenditures $100,000:
• Free cash flow = $500,000 - $100,000 = $400,000
• This is the cash available after maintaining/expanding assets
About Free Cash Flow Calculator
A free cash flow (FCF) calculator helps you calculate the cash available to the company after maintaining or expanding its asset base. Free Cash Flow = Operating Cash Flow - Capital Expenditures. FCF represents the cash that can be used for dividends, debt repayment, share buybacks, or investments without affecting operations. Positive FCF indicates financial strength and flexibility, while negative FCF may indicate heavy investment or financial stress. FCF is a key metric for valuation and financial analysis.
When to Use This Calculator
- Financial Analysis: Analyze cash generation and financial strength
- Business Valuation: Calculate FCF for valuation
- Investment Analysis: Assess company financial health
- Cash Management: Understand cash availability
Understanding Free Cash Flow
- Positive FCF: Cash available for dividends, debt repayment, or investments
- Negative FCF: May indicate heavy investment or financial stress
- Cash Generation: Measures cash generation after asset maintenance
- Financial Flexibility: Indicates financial strength and flexibility
Why Use Our Calculator?
- ✅ Financial Analysis: Calculate FCF accurately
- ✅ Business Valuation: Calculate FCF for valuation
- ✅ Investment Analysis: Assess financial health
- ✅ Cash Management: Understand cash availability
- ✅ 100% Free: No registration or payment required
Frequently Asked Questions
What is free cash flow (FCF)?
Free cash flow (FCF) is the cash available to the company after maintaining or expanding its asset base. It's calculated as Operating Cash Flow - Capital Expenditures. FCF represents the cash that can be used for dividends, debt repayment, share buybacks, or investments without affecting operations. Positive FCF indicates financial strength and flexibility, while negative FCF may indicate heavy investment or financial stress. FCF is a key metric for valuation and financial analysis.
Why is free cash flow important?
Free cash flow is important because it measures the cash available after maintaining operations and assets. It helps: (1) Financial analysis - analyze cash generation and financial strength, (2) Business valuation - calculate FCF for valuation (discounted cash flow models), (3) Investment analysis - assess company financial health, (4) Cash management - understand cash availability for dividends, debt repayment, or investments. FCF is considered one of the most important financial metrics because it shows actual cash available to stakeholders.
Is negative free cash flow bad?
Negative free cash flow isn't always bad - it depends on the context. Negative FCF can be acceptable when: (1) Growth phase - company is investing heavily in growth, (2) Capital-intensive businesses - heavy CapEx is normal, (3) Strategic investments - investing in future growth. However, negative FCF can be concerning when: (1) Persistent negative FCF - ongoing cash drain, (2) Financial stress - inability to generate cash, (3) Operational problems - poor cash generation. Evaluate negative FCF in context of business strategy and industry norms.
How is free cash flow different from operating cash flow?
Operating cash flow is cash from operating activities, while free cash flow is operating cash flow minus capital expenditures. Operating cash flow shows cash from core operations, while free cash flow shows cash available after maintaining or expanding assets. Free cash flow is more restrictive - it accounts for the cash needed to maintain or grow the asset base. FCF is often considered a better measure of cash available to stakeholders because it accounts for necessary capital expenditures.