The lack of transparent free cash flow data, combined with quarterly stock-based compensation expenses reaching $9.4M, obscures the company's ability to self-fund its ongoing R&D and operational requirements.
| Cash from Operations | 0 | -67.91M | -438.14M | -603.12M | -1.35B | -321.56M | -372.27M | -100.33M | -87.14M |
| Operating CF Margin % | - | -1.21% | -8.13% | -12.03% | -33.53% | -12.73% | -30.83% | -13.71% | -19.12% |
| Operating CF Growth % | 100% | 84.5% | 27.35% | 55.21% | -318.71% | 13.62% | -271.05% | -15.14% | - |
| Net Income | 107.35M | 82.21M | -550.12M | -745.88M | -1.03B | -1.75B | -601.46M | -209.29M | -163.93M |
| Depreciation & Amortization | 0 | 0 | 29.64M | 42.21M | 30.1M | 15.46M | 10.58M | 6.4M | 3.33M |
| Stock-Based Compensation | 0 | 22.6M | 30.8M | 70.71M | 72.2M | 36.42M | 25.07M | 6.18M | 5.29M |
| Deferred Taxes | 0 | 0 | 0 | 0 | -8.96M | 0 | 0 | 0 | 0 |
| Other Non-Cash Items | -107.35M | 58.65M | 66.31M | -40.65M | -545.58M | 667.85M | 2.6M | -26.86M | 118K |
| Working Capital Changes | 0 | -231.37M | -14.77M | 70.49M | 132.19M | 712.05M | 190.93M | 123.25M | 68.06M |
| Change in Receivables | 0 | -121.85M | 25.8M | -163.47M | 24.84M | -69.21M | -122.01M | -15.52M | -20.11M |
| Change in Inventory | 0 | 24.82M | 8.71M | 20M | -146.71M | -54.65M | -52.55M | -22.29M | -1.54M |
| Change in Payables | 0 | -13.85M | -123.36M | 121.35M | 12.45M | 78.63M | 28.12M | 14.61M | 8.84M |
| Cash from Investing | 0 | -13.59M | 125.57M | 125.82M | 47.07M | 760.97M | -1.08B | -374M | -10.84M |
| Capital Expenditures | 0 | -11.79M | -17.85M | -69.76M | -64.07M | -36.85M | -18.18M | -13.96M | -10.66M |
| CapEx % of Revenue | - | 0.21% | 0.33% | 1.39% | 1.6% | 1.46% | 1.51% | 1.91% | 2.34% |
| Acquisitions | 0 | 0 | -4.22M | 0 | 41.7M | -46.89M | -2M | 276K | 0 |
| Investments | - | - | - | - | - | - | - | - | - |
| Other Investing | 0 | 42.68M | -5.05M | -24.58M | 6.49M | 925K | 2.05M | 1.98M | 70K |
| Cash from Financing | 0 | 228.51M | -18.94M | 184.65M | 1.78B | 26.56M | 1.59B | 475.12M | 107.77M |
| Debt Issued (Net) | 0 | 273.93M | 99.29M | 225.94M | 257.52M | 0 | 0 | 0 | 57M |
| Equity Issued (Net) | 0 | -62.3M | -127.54M | -50.7M | 1.5B | 0 | 1.51B | 430.38M | 0 |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | 0 | -62.3M | -127.54M | -50.7M | 0 | 0 | 0 | 0 | 0 |
| Other Financing | 0 | 16.88M | 9.31M | 9.41M | 27.56M | 26.56M | 75.64M | 44.73M | 50.77M |
| Net Change in Cash | -599.49M | 144.56M | -329.55M | -288.06M | 463.35M | 435.87M | 131.59M | 1.91M | 9.79M |
| Free Cash Flow | 0 | -79.7M | -456M | -672.88M | -1.41B | -358.42M | -390.45M | -114.29M | -97.79M |
| FCF Margin % | - | -1.42% | -8.46% | -13.42% | -35.12% | -14.18% | -32.34% | -15.62% | -21.46% |
| FCF Growth % | 100% | 82.52% | 32.23% | 52.29% | -293.53% | 8.2% | -241.62% | -16.87% | - |
| FCF per Share | - | -0.67 | -3.76 | -5.96 | -11.59 | -3.18 | -4.09 | -1.16 | -0.99 |
| FCF Conversion (FCF/Net Income) | - | -0.83x | 0.80x | 0.83x | 1.35x | 0.18x | 0.62x | 0.48x | 0.65x |
| Interest Paid | 0 | 94.2M | 63.36M | 39.41M | 28.57M | 28.6M | 29.79M | 28.58M | 26.85M |
| Taxes Paid | 0 | 11.67M | 12.72M | 9.41M | 9.69M | 8.37M | 4.84M | 1.74M | 3.77M |
Regulatory and consumption sensitivity
As reported in financial statements, Youdao's cash flow data is currently unavailable, preventing a direct assessment of the relationship between net income and operating cash flow, which complicates the evaluation of earnings quality and the underlying sustainability of the company's reported profitability metrics over the last ten quarters.
The absence of operating cash flow data makes it impossible to determine if the reported net income is supported by actual cash generation or if it is heavily influenced by non-cash accruals. Investors should monitor future filings for a reconciliation between net income and cash from operations to identify potential gaps that could indicate aggressive revenue recognition or high working capital requirements.
Based on Youdao's reported figures, the lack of disclosed free cash flow data over the past ten quarters obscures the company's ability to self-fund operations, leaving analysts unable to verify if the business is generating sufficient cash to cover its ongoing R&D and marketing investments.
Without a clear view of free cash flow, it is difficult to gauge the company's financial independence from its parent, NetEase. The volatility in net income suggests that cash flow may be equally erratic, warranting caution until more granular cash flow statements are provided to the market.
According to recent SEC filings, Youdao consistently records stock-based compensation, with quarterly expenses reaching as high as $9.4M, which suggests that the company relies on equity-based incentives to manage its cost structure rather than relying solely on cash-based compensation for its workforce.
The reliance on stock-based compensation effectively dilutes existing shareholders and masks the true cash cost of talent acquisition. Analysts should treat these non-cash expenses as a recurring operational burden that, if converted to cash, would likely place further pressure on the company's already thin operating margins.
As indicated by the absence of dividends or share repurchases in the provided data, Youdao appears to be directing all available capital toward internal growth initiatives, specifically focusing on AI-driven hardware and software development to maintain its competitive position within the Chinese education technology sector.
The lack of capital returns to shareholders suggests that management views internal reinvestment as the primary driver of future value. However, given the volatility in net income, this strategy carries significant risk if the expected returns on these R&D investments fail to materialize in the form of sustainable, cash-generative growth.
Quick answers to the most common questions about buying DAO stock.
Youdao, Inc. (DAO) generated $0.0M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Youdao, Inc. (DAO) reported negative free cash flow of $0.0M in 2025, indicating capital requirements exceeded cash from operations.
Youdao, Inc. (DAO) spent $0.0M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.