Net income and free cash flow are related but are not the same measure. Net income represents a company's accounting profit, whereas cash flow presents whether a company's cash balance increased or ...
On February 20, 2025, Morningstar.com released an enhanced methodology for Free Cash Flow. Free cash flow represents a company's operating cash flow net of changes in net working capital and capital ...
It's the balance in your working capital account -- not profitability -- that determines whether your business is able to pay its monthly bills and meet short-term debt obligations on time.