What is the Formula for Calculating Free Cash Flow?


Free cash flow is the cash a company produces through its operations, less the cost of expenditures on assets. In other words, free cash flow – or FCF – is the cash left over after a company pays for its operating expenses and capital expenditures, also known as CAPEX.

Free cash flow is an important measurement since it shows how efficient a company is at generating cash. Investors use free cash flow to measure…



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