Free cash flow margins have improved to 21.7% in 2026Q1, though cash conversion remains volatile as evidenced by the erratic operating cash flow to net income ratio of 0.93.
| Cash from Operations | 383.4M | 319.31M | 136.68M | -12.72M | -35.9M |
| Operating CF Margin % | - | 37.45% | 34.49% | -10.98% | -44.94% |
| Operating CF Growth % | 1127.27% | 133.62% | 1174.83% | 64.58% | - |
| Net Income | 267.63M | 219.13M | -83.42M | -26.26M | -58.34M |
| Depreciation & Amortization | 6.57M | 6.83M | 3.15M | 1.78M | 807K |
| Stock-Based Compensation | 125.13M | 160.03M | 234.59M | 10.68M | 30.23M |
| Deferred Taxes | 0 | 0 | 0 | 0 | 0 |
| Other Non-Cash Items | -12.34M | -726K | -4.35M | 10.76M | 1.38M |
| Working Capital Changes | -3.58M | -65.96M | -13.29M | -9.68M | -9.97M |
| Change in Receivables | -65.16M | -44.34M | -30.48M | 2.39M | -6.04M |
| Change in Inventory | -5.82M | -12.95M | -19.29M | -5.56M | -19.36M |
| Change in Payables | 11.27M | 14.19M | 20.89M | -4.26M | 2.13M |
| Cash from Investing | -331.54M | -241.47M | -757.57M | -17.77M | -90.59M |
| Capital Expenditures | -40.59M | -37.54M | -34.24M | -2.76M | -3.87M |
| CapEx % of Revenue | 4.05% | 4.4% | 8.64% | 2.38% | 4.85% |
| Acquisitions | -93.83M | -28.79M | 0 | 0 | 0 |
| Investments | - | - | - | - | - |
| Other Investing | -3M | -500K | -1.41M | 0 | 0 |
| Cash from Financing | 9.5M | 9.8M | 655.84M | -502K | 151.67M |
| Debt Issued (Net) | 0 | 0 | 0 | 0 | 0 |
| Equity Issued (Net) | 13.76M | 9.8M | 671.13M | -210K | 149.55M |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | 0 | 0 | -1.07M | -210K | -313K |
| Other Financing | -4.26M | 0 | -15.29M | -292K | 2.12M |
| Net Change in Cash | 61.29M | 87.64M | 34.95M | -30.99M | 25.18M |
| Free Cash Flow | 342.81M | 281.76M | 102.43M | -15.48M | -39.77M |
| FCF Margin % | 34.23% | 33.05% | 25.85% | -13.37% | -49.79% |
| FCF Growth % | 216.92% | 175.07% | 761.83% | 61.08% | - |
| FCF per Share | 1.89 | 1.57 | 0.78 | -0.10 | -0.30 |
| FCF Conversion (FCF/Net Income) | 1.28x | 1.46x | -1.64x | 0.48x | 0.62x |
| Interest Paid | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | 0 | 0 | 7.79M | 2.48M | 0 |
Hyperscaler vertical integration risk
Based on reported financial statements, ALAB's operating cash flow to net income ratio has exhibited significant volatility, ranging from -8.36 in 2024Q3 to 2.64 in 2025Q2, suggesting that reported net income is frequently decoupled from the actual cash generated by core operational activities.
The wide variance in the OCF/NI ratio indicates that non-cash items and working capital fluctuations heavily influence the bottom line. Investors should interpret the recent 0.93 ratio in 2026Q1 as a more normalized alignment, though the historical instability warrants caution regarding the sustainability of cash conversion.
As reported in quarterly filings, Astera Labs has demonstrated an improving free cash flow trajectory, with margins reaching 21.7% in 2026Q1, a notable recovery from the negligible 0.3% margin observed in 2024Q1 as the company scaled its high-speed connectivity product shipments.
The expansion in FCF margins suggests that the company is successfully leveraging its fabless model to convert revenue growth into tangible liquidity. However, the inconsistency in quarterly margins implies that capital intensity and timing of payments remain sensitive to the company's rapid growth phase.
According to recent SEC filings, ALAB's working capital changes have been highly erratic, swinging from a $55.5 million outflow in 2025Q3 to a $44.9 million inflow in 2025Q2, reflecting the inherent challenges of managing inventory and receivables within a high-growth semiconductor supply chain.
These sharp fluctuations in working capital suggest that the company's cash position is highly susceptible to the timing of large orders from hyperscale customers. Such volatility may indicate that the company is periodically absorbing significant inventory costs to ensure supply chain reliability for its key partners.
Analysis of the cash flow statement reveals that stock-based compensation remains a substantial non-cash adjustment, with $48.9 million recorded in 2026Q1, which effectively masks the true economic cost of talent retention required to maintain the company's competitive edge in signal integrity.
By adding back significant SBC to arrive at operating cash flow, the company presents a more favorable liquidity picture than the underlying equity dilution might suggest. Investors should monitor whether this reliance on equity-based compensation persists as the company matures and seeks to stabilize its operating expenses.
Quick answers to the most common questions about buying ALAB stock.
Astera Labs, Inc. Common Stock (ALAB) generated $319.3M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Astera Labs, Inc. Common Stock (ALAB) generated $281.8M in free cash flow in 2025. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
Astera Labs, Inc. Common Stock (ALAB) spent $37.5M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.