Operating Cash Flow

Operating cash flow means the cash generated from a company’s normal business operations. In simple terms, operating cash flow shows how much cash the core business brings in. Operating cash flow is important because it helps investors see whether a company’s operations are actually producing cash. A company may report profit but still have weak operating cash flow. For example, cash received from customers minus cash paid to suppliers, employees, and operating costs can be part of operating cash flow. Operating cash flow is not the same as free cash flow. Free cash flow subtracts capital expenditures from operating cash flow.