Free Cash Flow Calculator
Compute Free Cash Flow from operating cash flow or EBIT. Includes FCF margin, FCF yield, and a strong/good/weak benchmark.
Free Cash Flow Examples
In the operating cash flow mode, free cash flow equals operating cash flow minus capital expenditures.
| Operating Cash Flow | Capital Expenditures | Free Cash Flow | FCF Margin on $500,000 Revenue |
|---|---|---|---|
| $50,000.00 | $10,000.00 | $40,000.00 | 8% |
| $100,000.00 | $20,000.00 | $80,000.00 | 16% |
| $150,000.00 | $50,000.00 | $100,000.00 | 20% |
| $200,000.00 | $120,000.00 | $80,000.00 | 16% |
| $300,000.00 | $75,000.00 | $225,000.00 | 45% |
Frequently Asked Questions about the Free Cash Flow Calculator
What is Free Cash Flow?
Free Cash Flow (FCF) is the cash a company generates from operations after subtracting the capex it needs to maintain and grow the business. It is the cleanest proxy for cash a company can return to shareholders or use to pay down debt.
How is FCF calculated from operating cash flow?
FCF = Operating Cash Flow - Capital Expenditures. If OCF is $500M and capex is $200M, FCF is $300M. This is the simplest method and uses numbers from the cash-flow statement directly.
How is FCF calculated from EBIT?
FCF = EBIT x (1 - tax rate) + D and A - capex - change in working capital. This builds FCF from the income statement and is the formula used in most DCF (discounted cash flow) valuations.
What is a good FCF margin?
Industry-dependent. Software and SaaS companies often hit 20 to 30 percent. Mature manufacturers run 5 to 10 percent. The calculator labels above 10 percent as strong, 5 to 10 as good, and below 5 as weak.
Can FCF be negative?
Yes, and it does not always mean trouble. Fast-growing companies often have negative FCF because they invest heavily in capex and working capital to fuel growth. Persistent negative FCF without a clear growth story is a red flag.
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