Apple reported substantially higher net income in fiscal 2025. Yet its free cash flow, calculated from the company’s cash flow statement, moved in the opposite direction. Net income increased 19.50% to $112.010 billion, while free cash flow fell 9.23% to $98.767 billion. Under a consistent free-cash-flow-to-net-income definition, Apple’s cash conversion ratio declined from 116.08% in … Read more
A chipmaker can report faster revenue growth, higher gross profit, and a stronger gross margin while generating less free cash flow. Taiwan Semiconductor Manufacturing Company (NYSE: TSM) provided a useful example in the second quarter of 2026. TSMC’s revenue increased 12.0% sequentially, and its gross margin rose from 66.2% to 67.7%. Yet its quarterly free … Read more
A company can report stronger revenue, higher operating profit, and more cash from operations while free cash flow still falls. One common reason is capital expenditures, or CapEx. That does not automatically mean the business is deteriorating. A company may be replacing aging equipment, building a new factory, expanding data-center capacity, or investing ahead of … Read more
Revenue growth can make a business look stronger at first glance, but sales alone do not tell investors how much cash ultimately remains after the company funds its operations and capital spending. Free cash flow margin adds that missing perspective. It measures free cash flow as a percentage of revenue, giving investors a practical way … Read more
Learning how to analyze gross margin helps investors understand whether improving profitability comes from pricing power, lower production costs, or a better product mix. Revenue growth often gets the headline during earnings season, but higher sales do not automatically mean that a business is becoming more profitable. Gross margin can reveal useful information about pricing … Read more