Definition The cash left from normal operations after paying for long-term investments. It shows how much cash a business can freely use.
Example €300k of operating cash flow minus €80k of CAPEX gives free cash flow of €220k.
For your role Your role Choose your role Accounts payable Credit controllers FP&A analysts Finance business partners Finance directors and CFOs Financial controllers Management accountants Payroll specialists Account executives Sales managers Sales operations analysts Sales representatives Bid and tender managers Commercial directors New to business Pricing analysts Revenue managers Senior leaders Campaign managers Communications managers Customer insight analysts Digital marketing managers Marketing analysts Marketing directors HR business partners HR directors Learning and development managers People analysts People managers Recruiters Operations analysts Operations directors Operations managers AI product managers Heads of product Product analysts Product managers Product owners Machine learning engineers Analytics engineers Data analysts Data architects Data engineers Data governance leads Data privacy officers Data scientists Information architects Platform engineers Report builders Business analysts Corporate development managers Heads of strategy Strategy analysts
Choose your role to see what this term means in your work.
Why it matters It shows how much cash is truly available to invest or return to owners.
Where it is used Investor reports and company valuations.
How to calculate it Operating cash flow − CAPEX
Worked example €300k of operating cash flow minus €80k of CAPEX gives free cash flow of €220k.
