Liquidity is under severe pressure, evidenced by a free cash flow margin of -55.4% in 2026Q2 and a $3.1 million outflow related to working capital volatility.
| Cash from Operations | -3.48M | -1.28M | 2.22M | 783.94K | -159.42K | 2.45M | 425.34K |
| Operating CF Margin % | - | -9.53% | 13.09% | 4.25% | -0.67% | 13.57% | 3.52% |
| Operating CF Growth % | -126211.83% | -157.8% | 183.24% | 591.76% | -106.51% | 475.79% | - |
| Net Income | -18.27M | -10.9M | 8.65K | 477.69K | 1.83M | 2M | 1.1M |
| Depreciation & Amortization | 1.19M | 487.24K | 609.7K | 632.3K | 552.97K | 263.05K | 204.22K |
| Stock-Based Compensation | 4.24M | 2.67M | 0 | 0 | 0 | 0 | 0 |
| Deferred Taxes | -9.83K | 48.98K | -2.53K | 34.49K | -16.66K | 72.02K | -60.22K |
| Other Non-Cash Items | 10.55M | 6.05M | 658.51K | 2.77M | 6.19M | 1.42M | 862.44K |
| Working Capital Changes | -1.17M | 355.1K | 946.09K | -1.04M | -3.87M | -832.97K | -1M |
| Change in Receivables | -542.05K | 209.13K | 1.25M | -1.32M | -2.41M | 85.66K | -610.68K |
| Change in Inventory | -1.39M | 155.9K | 235.15K | -177.18K | -1.36M | -26.86K | 115.72K |
| Change in Payables | 464.83K | 231.83K | -729.13K | 676.58K | 29.73K | -8.35K | 24.19K |
| Cash from Investing | -5.26M | -5.16M | -1.62M | 1.16M | -2.26M | -1.4M | 10.48K |
| Capital Expenditures | -222.44K | -98.24K | -55.22K | -353.97K | -919.54K | -395.12K | -99.36K |
| CapEx % of Revenue | 0.74% | 0.73% | 0.33% | 1.92% | 3.85% | 2.19% | 0.82% |
| Acquisitions | -9.35K | 0 | 0 | 18.45K | 23.53K | 0 | 0 |
| Investments | - | - | - | - | - | - | - |
| Other Investing | -5.17M | -3.12M | -1.2M | -257.95K | 282.03K | 34.34K | 109.84K |
| Cash from Financing | 8.61M | 8.68M | 50.43K | 520.89K | 1.08M | 441.82K | 322.08K |
| Debt Issued (Net) | 227.8K | 4.6M | -139.8K | 145.93K | 239.43K | 0 | 0 |
| Equity Issued (Net) | 8.26M | 4.26M | 353.59K | 548.37K | 835.81K | 820.13K | 322.08K |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | -277.4K | -179.19K | 0 | 0 | 0 | 0 | 0 |
| Other Financing | 124.03K | -183.07K | -163.36K | -173.4K | -375.87K | -378.31K | 0 |
| Net Change in Cash | 27.93K | 2.24M | 412.26K | 2.28M | -1.21M | 1.69M | 655.82K |
| Free Cash Flow | -3.7M | -1.38M | 2.17M | 429.97K | -1.08M | 2.05M | 325.98K |
| FCF Margin % | -12.35% | -10.26% | 12.76% | 2.33% | -4.52% | 11.38% | 2.69% |
| FCF Growth % | -768.06% | -163.81% | 403.58% | 139.85% | -152.53% | 530.08% | - |
| FCF per Share | -2.07 | -1.05 | 1.70 | 0.32 | -0.79 | 1.51 | 0.05 |
| FCF Conversion (FCF/Net Income) | 0.20x | 0.12x | 256.64x | 1.64x | -0.09x | 1.22x | 0.66x |
| Interest Paid | 163 | 163 | 774 | 0 | 0 | 0 | 0 |
| Taxes Paid | 0 | 97.07K | 115.93K | 81.39K | 143.39K | 108.91K | 71.95K |
Liquidity exhaustion and burn
According to recent financial disclosures, Eshallgo's operating cash flow has consistently failed to track with net income, evidenced by a 2026Q2 OCF/NI ratio of 0.58, which highlights a persistent inability to convert accounting profits into tangible liquidity for the business.
The recurring disconnect between net losses and operating cash outflows suggests that the company's accrual-based accounting is masking deeper operational inefficiencies. Investors should monitor whether this divergence stems from aggressive revenue recognition or an inability to collect on service contracts, as the current trend indicates a fundamental breakdown in cash generation.
As reported in quarterly filings, Eshallgo's free cash flow margin has deteriorated significantly, reaching -55.4% in 2026Q2, a sharp decline from the positive territory observed in previous periods, which underscores the company's struggle to maintain self-sustaining operations.
The rapid shift toward negative free cash flow suggests that the company's current business model is unable to cover its operating and capital requirements without external funding. This trajectory implies that the firm is consuming its limited cash reserves at an accelerating pace, which may necessitate dilutive financing in the near term.
Based on the provided cash flow statements, working capital fluctuations have become a primary source of cash volatility, with a $3.1 million outflow in 2026Q2 alone, indicating significant challenges in managing receivables and inventory cycles effectively.
The erratic nature of these working capital changes suggests that Eshallgo is facing difficulties in aligning its cash collection cycles with its procurement obligations. This instability in the cash conversion cycle appears to be a major contributor to the company's current liquidity pressure and warrants further investigation into client credit quality.
As evidenced by the 2025Q4 data, the company recorded $4.2 million in stock-based compensation, which significantly obscures the true cash cost of operations and inflates the reported operating cash flow relative to the actual economic reality of the business.
The reliance on non-cash adjustments to manage the appearance of cash flow suggests that management may be attempting to mitigate the optics of a deteriorating balance sheet. Analysts should treat these adjustments with caution, as they do not represent actual cash inflows and may mask the underlying severity of the company's cash burn.
Quick answers to the most common questions about buying EHGO stock.
Eshallgo Inc. Class A Ordinary Shares (EHGO) generated $-1.3M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Eshallgo Inc. Class A Ordinary Shares (EHGO) reported negative free cash flow of $1.4M in 2025, indicating capital requirements exceeded cash from operations.
Eshallgo Inc. Class A Ordinary Shares (EHGO) spent $0.1M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, Eshallgo Inc. Class A Ordinary Shares (EHGO) spent $0.2M on share repurchases. This shows the company's commitment to returning capital to its equity investors.