Free cash flow margins have compressed significantly from 15.0% in 2023Q2 to 5.9% in 2025Q3, reflecting a disconnect between reported earnings and actual cash generation.
| Metric | TTM | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 | Dec'05 | Dec'04 | Dec'03 | Dec'02 | Dec'01 | Dec'00 | Dec'99 | Dec'98 | Dec'97 | Dec'96 | Dec'95 |
|---|
| Cash from Operations | 38.88M | 29.49M | 72.13M | 39.45M | 76.17M | -3.14M | 43.33M | 73.69M | 78.27M | 71.16M | 80.64M | 74.91M | 57.04M | 59.2M | 59.51M | 38.26M | 33.26M | 20.48M | 50.3M | 40.16M | 57.3M | 30.07M | 26.61M | 8.82M | 8.16M | -8.41M | -25.49M | 25.54M | 76M | 16.73M | 14.09M |
| Operating CF Margin % | - | 6.52% | 15.55% | 8.64% | 19.13% | -1.09% | 8% | 11.69% | 14.79% | 14.04% | 16.41% | 15.86% | 12.33% | 12.12% | 11.05% | 6.97% | 5.47% | 2.69% | 5.35% | 4.04% | 5.85% | 3.13% | 2.83% | 0.93% | 0.78% | -0.73% | -1.6% | 1.48% | 2.91% | 0.66% | 0.55% |
| Operating CF Growth % | 2282.34% | -59.12% | 82.82% | -48.21% | 2528.21% | -107.24% | -41.2% | -5.85% | 9.99% | -11.75% | 7.64% | 31.33% | -3.65% | -0.51% | 55.56% | 15.01% | 62.38% | -59.27% | 25.25% | -29.92% | 90.58% | 13.01% | 201.64% | 8.1% | 197% | 67% | -199.8% | -66.39% | 354.38% | 18.7% | -74.17% |
| Net Income | 10.22M | 21.57M | 19.95M | 74.71M | 78.07M | -5.12M | 117.41M | 43.69M | 39.59M | 19.4M | 35.98M | 32.73M | 24.57M | 22.31M | 112.29M | 22.71M | 41.55M | 14.66M | 34.71M | 30.34M | -7.33M | -37.67M | -31.48M | 68.14M | -88.54M | -98M | -381.9M | -181.42M | -134.5M | -85.46M | -55.03M |
| Depreciation & Amortization | 16.84M | 14.86M | 14.38M | 14.86M | 15.45M | 16.16M | 19.85M | 27.04M | 23.72M | 22.18M | 21.47M | 21.22M | 21.5M | 22.3M | 27.98M | 29.64M | 32.34M | 39.77M | 50.52M | 58.61M | 59.62M | 60.82M | 61.09M | 78.46M | 114.56M | 137.77M | 270.35M | 266.76M | 133.8M | 129.95M | 132.87M |
| Stock-Based Compensation | 11.29M | 10.68M | 8.88M | 11.4M | 13.6M | 7.95M | 6.69M | 6.04M | 8.54M | 7.61M | 6.63M | 5.85M | 4.85M | 3.5M | 4.22M | 2.84M | 4.67M | 0 | 4.77M | 7.63M | 1.68M | 0 | 408K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Deferred Taxes | 2.81M | -267K | -1.5M | 15.28M | 9.07M | 3.98M | 16M | 6.19M | 10.27M | 8.84M | 14.01M | 13.21M | 9.1M | 11.42M | 3.22M | 324K | 671K | 837K | 4.3M | 12.83M | -1.68M | 0 | -408K | 0 | 0 | 0 | 0 | 84K | -200K | -9.03M | -3.45M |
| Other Non-Cash Items | 7.45M | 3.78M | 20.42M | -55.09M | -58.13M | -2.42M | -93.69M | 3.17M | 5.27M | 27.63M | 2.97M | 1.44M | 9.42M | 9.08M | -82.49M | 1.18M | -15.54M | 5.22M | -34.28M | -39.61M | 6.62M | 24.2M | -53K | -94.55M | 9.38M | -16.91M | 168.03M | -11.68M | 11M | -19M | -30.67M |
| Working Capital Changes | -9.73M | -21.13M | 9.99M | -21.71M | 18.12M | -23.69M | -22.94M | -12.44M | -9.13M | -14.5M | -420K | 468K | -12.4M | -9.41M | -5.71M | -18.44M | -30.44M | -38.97M | -9.74M | -29.64M | -1.61M | -17.27M | -2.95M | -43.22M | -27.23M | -31.27M | -81.98M | -48.2M | 63.2M | -8.65M | -37.13M |
| Change in Receivables | 649K | -3.29M | 3.9M | -5.89M | 1.37M | -13.95M | -18.83M | -4.72M | -807K | -15.79M | 1.44M | -1.12M | 116K | -1.74M | 2.23M | -12.87M | -736K | 0 | 1.42M | -2.16M | 0 | 0 | 0 | -4.9M | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Change in Inventory | -199K | 428K | 3.36M | -460K | -3.88M | 101K | 1.67M | 141K | -192K | 71K | -166K | -71K | 9K | 548K | 598K | 128K | 1.29M | 1.03M | 1.71M | 9K | 81K | -131K | -443K | 848K | 1.71M | 505K | 899K | 474K | 3M | -833K | -848K |
| Change in Payables | 7.58M | -9.51M | 4.03M | 3.92M | 6.61M | -10.68M | -5.17M | -5.15M | 10.03M | 4.77M | 2.35M | 1.56M | -5.52M | -1.22M | 2.04M | 1.37M | -1.37M | 0 | 2.33M | -2.34M | 0 | 0 | 0 | -3.16M | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Cash from Investing | -34.17M | -26.67M | -7.56M | -86.6M | 29.01M | 4.65M | 104.97M | -32.02M | -27.15M | -32.66M | -32.73M | -21.29M | -16.47M | -3.5M | -7.7M | -5.28M | 23.76M | 9.66M | 47.66M | 62.36M | -40.04M | -32.16M | -13.95M | 18.95M | -75.06M | 204.82M | 67.93M | 235.28M | -36M | -109.45M | 186.37M |
| Capital Expenditures | -36.51M | -28.57M | -9.98M | -11.84M | -7.36M | -6.96M | -13.97M | -22.02M | -18.81M | -19.75M | -26.98M | -22.08M | -16.82M | -14.16M | -17.64M | -27.38M | -18.41M | -27.88M | -30.85M | -32.27M | -47.16M | -36.13M | -32.02M | -41.69M | -41.12M | -37.47M | -107.94M | -65.7M | -63.6M | -55.03M | -123.74M |
| CapEx % of Revenue | 7.98% | 6.32% | 2.15% | 2.59% | 1.85% | 2.41% | 2.58% | 3.5% | 3.55% | 3.9% | 5.49% | 4.67% | 3.64% | 2.9% | 3.28% | 4.99% | 3.03% | 3.67% | 3.28% | 3.25% | 4.82% | 3.76% | 3.4% | 4.39% | 3.95% | 3.24% | 6.79% | 3.82% | 2.44% | 2.16% | 4.81% |
| Acquisitions | -1.02M | 0 | 0 | -82.5M | -10.37M | 6.96M | -11.32M | -10.42M | -12.35M | -14.28M | -5.8M | 0 | -3.98M | -1.42M | 0 | 0 | 0 | 0 | -2.21M | -825K | 0 | 0 | 0 | 0 | 0 | -4.46M | -13.96M | 479.64M | 0 | -64.08M | 294.58M |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | 1.59M | 121K | 1.86M | 7.25M | 47.04M | 3.15M | 118.05M | -928K | 4.02M | 1.38M | 45K | 787K | 4.33M | 12.09M | 9.95M | 18.68M | 42.17M | 37.54M | 80.72M | 95.45M | 7.12M | 3.97M | 18.08M | 60.64M | -33.94M | -1.91M | 127.15M | -1.7M | 27.6M | 9.65M | 15.52M |
| Cash from Financing | -3.96M | -6.01M | -63.19M | 20.04M | -78.45M | -994K | -149.95M | -41.63M | -48.73M | -37.59M | -49.3M | -53.49M | -51.19M | -55.88M | -67.15M | -30.43M | -51.54M | -30.67M | -102.62M | -104.52M | -4.59M | 10.29M | -11.01M | -28.75M | 46.33M | -334.98M | -32.23M | -94.81M | -78.3M | -11.87M | -70.21M |
| Debt Issued (Net) | -817K | 7.61M | -8.11M | 89.8M | -45.24M | -28.89M | -53.26M | 26.86M | 35.27M | 20.05M | 55.77M | -18.85M | -21.48M | -37.12M | -46.46M | -22.07M | -51.4M | -31.66M | -104.34M | -104.16M | -6.27M | -60.76M | -7.76M | -20.11M | 47.3M | -333.09M | -44.51M | -93.24M | -43.21M | 11.89M | -56.03M |
| Equity Issued (Net) | -2.13M | -1000K | -1000K | -1000K | -1000K | 1000K | -1000K | -1000K | -1000K | -1000K | -1000K | -1000K | -1000K | -1000K | -1000K | -1000K | 0 | 995K | 1000K | 1000K | 1000K | 1000K | 0 | 35K | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -14.18M | -14.18M |
| Share Repurchases | -2.13M | -11.72M | -52.08M | -64.97M | -29.96M | -36.01M | -94.46M | -61.24M | -83.05M | -51.64M | -92.64M | -36.06M | -25.04M | -21.62M | -21.57M | -3.89M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Financing | -1.01M | -1.89M | -3.01M | -4.78M | -3.25M | -5.66M | 971K | -5.54M | -947K | -6M | -13.16M | 1.83M | -7.63M | 2.86M | 883K | -4.46M | -146K | 0 | -401K | -2.37M | -296K | -19.22M | -3.26M | -8.67M | -964K | -1.89M | -3.44M | -1.57M | -4.61M | -9.59M | 0 |
| Net Change in Cash | 758K | -3.19M | 1.37M | -27.1M | 26.73M | 520K | -1.65M | 43K | 2.39M | 921K | -1.4M | 131K | -10.62M | -175K | -15.33M | 2.55M | 5.48M | -523K | -4.66M | -2.01M | 12.68M | 8.2M | 1.65M | -979K | -20.56M | -138.57M | 10.2M | 166.01M | -38.3M | -104.6M | 130.25M |
| Free Cash Flow | 2.37M | 918K | 62.15M | 27.61M | 68.82M | -10.1M | 29.35M | 51.66M | 59.46M | 51.41M | 53.66M | 52.84M | 40.22M | 45.04M | 41.87M | 10.87M | 14.85M | -7.4M | 19.44M | 7.89M | 10.14M | -6.06M | -5.42M | -32.87M | -32.96M | -45.89M | -133.44M | -40.16M | 12.4M | -38.3M | -109.65M |
| FCF Margin % | 0.52% | 0.2% | 13.4% | 6.05% | 17.28% | -3.5% | 5.42% | 8.2% | 11.24% | 10.14% | 10.92% | 11.19% | 8.7% | 9.22% | 7.77% | 1.98% | 2.44% | -0.97% | 2.07% | 0.79% | 1.04% | -0.63% | -0.58% | -3.46% | -3.17% | -3.97% | -8.39% | -2.33% | 0.48% | -1.51% | -4.26% |
| FCF Growth % | -88.2% | -98.52% | 125.11% | -59.88% | 781.43% | -134.41% | -43.19% | -13.11% | 15.65% | -4.19% | 1.56% | 31.35% | -10.69% | 7.58% | 285.02% | -26.79% | 300.81% | -138.04% | 146.39% | -22.17% | 267.28% | -11.89% | 83.52% | 0.27% | 28.18% | 65.61% | -232.29% | -423.85% | 132.38% | 65.07% | -9.73% |
| FCF per Share | 0.05 | 0.02 | 1.11 | 0.45 | 1.05 | -0.17 | 0.47 | 0.79 | 0.84 | 0.67 | 0.63 | 0.60 | 0.43 | 0.47 | 0.42 | 0.11 | 0.15 | -0.07 | 0.20 | 0.08 | 0.11 | -0.09 | -0.13 | -0.81 | -0.82 | -1.15 | -3.33 | -1.03 | 0.29 | -0.90 | -2.58 |
| FCF Conversion (FCF/Net Income) | 0.23x | 1.37x | 3.62x | 0.53x | 0.98x | 0.61x | 0.37x | 1.69x | 1.98x | 3.67x | 2.24x | 2.29x | 2.32x | 2.65x | 0.53x | 1.68x | 0.80x | 1.40x | 1.45x | 1.32x | -7.82x | -0.80x | -0.85x | 0.13x | -0.09x | 0.09x | 0.07x | -0.14x | -0.57x | -0.20x | -0.26x |
| Interest Paid | 17.35M | 16.98M | 13.39M | 12.94M | 14.16M | 0 | 0 | 0 | 0 | 11.29M | 8.14M | 8.17M | 9.34M | 12.92M | 21.35M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | -1.66M | 6.18M | 9.2M | 9.3M | 9.94M | 0 | 0 | 0 | 0 | 3.01M | 5.36M | 3.8M | 2.78M | 2.03M | 1.12M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Liquidity and operational constraints
As reported in recent financial filings, the OCF/NI ratio has fluctuated wildly, reaching an extreme 25.28 in 2025Q3, which suggests that reported net income is increasingly decoupled from the actual cash-generating capacity of the underlying restaurant operations and franchise royalty streams.
The significant divergence between net income and operating cash flow indicates that non-cash charges and working capital adjustments are heavily influencing the bottom line. Investors should monitor whether this disconnect reflects a structural decline in earnings quality or merely the impact of accounting timing differences in the franchise model.
Based on the provided quarterly data, FCF margins have trended downward from 15.0% in 2023Q2 to 5.9% in 2025Q3, signaling that the company's ability to convert revenue into discretionary cash is being eroded by rising operational costs and persistent capital expenditure requirements.
The inconsistent FCF trajectory suggests that the company is struggling to maintain efficiency as it navigates a challenging labor and commodity environment. The inability to consistently generate positive free cash flow in recent quarters may limit the firm's flexibility to fund future growth initiatives or debt obligations.
According to the latest quarterly statements, CapEx as a percentage of revenue has climbed to 8.2% in 2025Q3, up from 1.7% in 2023Q2, indicating that the company is forced to reinvest a larger portion of its top-line revenue into maintaining its aging restaurant infrastructure.
This trend toward higher capital intensity appears to contradict the company's stated asset-light strategy, suggesting that legacy store maintenance is becoming more expensive than anticipated. Such elevated spending levels may continue to suppress free cash flow unless the company can successfully pivot toward higher-margin, lower-maintenance growth vehicles.
As indicated by historical cash flow statements, the company has prioritized share repurchases despite a dwindling cash position, with buybacks totaling $16.7 million in 2023Q4 alone, a strategy that appears increasingly difficult to sustain given the current $1.69 million cash balance.
The aggressive return of capital to shareholders during periods of operational volatility warrants further investigation into the company's long-term liquidity management. Investors should consider whether these buybacks are effectively creating value or if they are depleting the resources necessary to navigate current industry headwinds.
Quick answers to the most common questions about buying DENN stock.
Denny's Corporation (DENN) generated $29.5M in net cash from operating activities in 2024. This reflects the cash generated directly from core business operations.
Denny's Corporation (DENN) generated $0.9M in free cash flow in 2024. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
Denny's Corporation (DENN) spent $28.6M on capital expenditures in 2024. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2024, Denny's Corporation (DENN) spent $11.7M on share repurchases. This shows the company's commitment to returning capital to its equity investors.