Cash flow remains erratic, evidenced by an OCF/NI ratio of -4.86 in 2026Q4 and free cash flow margins that have fluctuated between -8.0% and 37.6% over the last two years.
| Cash from Operations | 212.51M | 133.84M | 71.15M | 101.88M | 19.51M | 29.48M | 44.31M | 55.58M | 12.38M | 2.12M | 24.52M | -7.51M |
| Operating CF Margin % | 12.99% | 10.19% | 6.95% | 17.6% | 4.98% | 9.27% | 15.67% | 20.78% | 4.59% | 0.92% | 12.81% | -5.18% |
| Operating CF Growth % | 58.78% | 88.1% | -30.16% | 422.13% | -33.8% | -33.48% | -20.27% | 349.04% | 483.87% | -91.35% | 426.62% | - |
| Net Income | 54.6M | 112.09M | 127.66M | 61.53M | 21.77M | 6.23M | 17.88M | 15.53M | 33.48M | 5.31M | 4.36M | -8.19M |
| Depreciation & Amortization | 79.36M | 44.12M | 35.91M | 22.16M | 27.08M | 25.18M | 22.84M | 17.86M | 14.52M | 13.15M | 10.29M | 7.99M |
| Stock-Based Compensation | 86.92M | 71.79M | 40.63M | 29.12M | 19.65M | 19.68M | 15.49M | 16.82M | 13.47M | 7.15M | 503K | 5.67M |
| Deferred Taxes | -3.52M | 446K | -3.28M | -6.4M | -3.7M | -8.58M | 2.44M | -939K | -13.43M | -7.58M | -3.93M | -2.31M |
| Other Non-Cash Items | -4.84M | 10.43M | -6.02M | 701K | 1.4M | 3.87M | -4.36M | 1.27M | 2.54M | -6.44M | 6.89M | 1.04M |
| Working Capital Changes | 0 | -105.03M | -123.75M | -5.23M | -46.69M | -16.91M | -9.98M | 5.05M | -38.2M | -9.48M | 6.41M | -11.7M |
| Change in Receivables | -17.5M | -2.74M | -49.6M | -22.43M | -5.6M | -10.53M | 2.5M | 7.65M | -8M | -15.39M | 4.45M | -5.49M |
| Change in Inventory | 7.33M | 4.87M | -93.93M | 3.17M | -27.66M | -10.94M | -435K | 16.34M | 6.72M | -37.99M | -2.15M | -6.21M |
| Change in Payables | 75.29M | -23.4M | 81.22M | 42.99M | 1.5M | 17.47M | 5.96M | -10.25M | -25.48M | 43.14M | 3.53M | -27.89M |
| Cash from Investing | -605.25M | -19.1M | -284.66M | -1.72M | -4.82M | -6.47M | -35.34M | -8.87M | -10.42M | -9.14M | -10.24M | -239.51M |
| Capital Expenditures | -22.45M | -18.52M | -8.66M | -1.72M | -4.82M | -6.47M | -9.42M | -8.87M | -7.54M | -9.22M | -10.24M | -1.62M |
| CapEx % of Revenue | 1.37% | 1.41% | 0.85% | 0.3% | 1.23% | 2.04% | 3.33% | 3.32% | 2.8% | 4.02% | 5.35% | 1.11% |
| Acquisitions | -581.68M | 0 | -274.97M | 0 | 0 | 0 | -25.92M | 0 | 0 | 0 | 0 | -238M |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -1.12M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 84K | 0 | 109K |
| Cash from Financing | 533.92M | -74.45M | 200.94M | -22.73M | -29.11M | -11.4M | -16.68M | -5.56M | -7.2M | 8.31M | -4.94M | 252.57M |
| Debt Issued (Net) | 0 | -6.2M | 196.63M | -30M | -28.94M | -11.76M | 0 | - | - | - | - | - |
| Equity Issued (Net) | 0 | -66.11M | 5.56M | 8.05M | 1.68M | 1.5M | 0 | - | - | - | - | - |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -68M | 0 | 0 |
| Share Repurchases | -49.99M | -67.06M | 0 | 0 | 0 | 0 | -7.9M | 0 | 0 | 178.25M | 0 | 105.14M |
| Other Financing | 533.92M | -2.14M | -1.24M | -788K | -1.84M | -1.15M | -16.68M | 1.51M | 24.98M | -1.27M | 26.76M | 155M |
| Net Change in Cash | 140.99M | 40.51M | -12.6M | 77.42M | -14.41M | 11.6M | -7.71M | 41.15M | -5.24M | 1.29M | 9.34M | 12.49M |
| Free Cash Flow | 190.06M | 115.32M | 62.49M | 100.16M | 14.7M | 23M | 34.89M | 46.71M | 4.83M | -7.1M | 14.28M | -9.12M |
| FCF Margin % | 11.61% | 8.78% | 6.1% | 17.3% | 3.75% | 7.23% | 12.34% | 17.47% | 1.79% | -3.09% | 7.46% | -6.29% |
| FCF Growth % | 64.81% | 84.53% | -37.6% | 581.59% | -36.11% | -34.08% | -25.3% | 866.28% | 168.06% | -149.75% | 256.49% | - |
| FCF per Share | 3.20 | 1.98 | 1.08 | 1.81 | 0.27 | 0.44 | 0.69 | 0.95 | 0.10 | -0.14 | 0.32 | -0.33 |
| FCF Conversion (FCF/Net Income) | 3.89x | 1.19x | 0.56x | 1.66x | 0.90x | 4.73x | 2.48x | 3.58x | 0.37x | 0.40x | 5.63x | 0.38x |
| Interest Paid | 0 | 15.66M | 11.27M | 3.58M | 1.82M | 3.15M | 0 | - | - | - | - | - |
| Taxes Paid | 0 | 25.33M | 12.4M | 13.37M | 7.57M | 2.3M | 0 | - | - | - | - | - |
Working Capital Volatility
As reported in recent financial statements, the relationship between net income and operating cash flow is highly erratic, with the OCF/NI ratio swinging from -4.86 in 2026Q4 to 7.82 in 2026Q2, indicating that reported earnings are a poor proxy for actual cash generation.
The extreme variance in the OCF/NI ratio suggests that accruals and non-cash adjustments are significantly distorting the company's bottom line. Investors should monitor whether this disconnect stems from aggressive revenue recognition or timing differences in marketing-related payables, as it complicates the assessment of true operational profitability.
Based on the provided cash flow data, free cash flow margins have exhibited significant instability, ranging from a negative 8.0% in 2024Q3 to a peak of 37.6% in 2025Q4, reflecting the company's struggle to maintain consistent cash conversion amid aggressive top-line expansion efforts.
The lack of a stable FCF trajectory suggests that the company's cash generation is highly sensitive to seasonal inventory builds and marketing spend cycles. This inconsistency warrants further investigation into whether the business can achieve sustainable cash flow maturity without sacrificing its current growth-at-all-costs operational model.
According to quarterly cash flow disclosures, working capital changes have been a primary driver of cash flow volatility, with a massive $84.4 million outflow in 2026Q4 contrasting sharply with the $114.2 million inflow observed during 2025Q3, highlighting significant fluctuations in inventory and payables management.
These dramatic shifts in working capital suggest that the company's cash position is heavily dependent on the timing of inventory procurement and retailer payment cycles. Such volatility may indicate that the company is using its supply chain as a financing tool, which could become a liability if retail demand softens.
As indicated by recent SEC filings, stock-based compensation remains a material non-cash expense, reaching $29.9 million in 2026Q3, which effectively subsidizes the company's operating cash flow and masks the true economic cost of talent acquisition required to sustain its high-frequency product launch cadence.
By adding back significant SBC to operating cash flow, the company presents a more favorable liquidity picture than the underlying cash-based operations might justify. Analysts should consider the dilutive impact of these grants alongside the cash flow figures to gain a more accurate view of the company's true economic performance.
Quick answers to the most common questions about buying ELF stock.
e.l.f. Beauty, Inc. (ELF) generated $212.5M in net cash from operating activities in 2026. This reflects the cash generated directly from core business operations.
e.l.f. Beauty, Inc. (ELF) generated $190.1M in free cash flow in 2026. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
e.l.f. Beauty, Inc. (ELF) spent $22.4M on capital expenditures in 2026. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2026, e.l.f. Beauty, Inc. (ELF) spent $50.0M on share repurchases. This shows the company's commitment to returning capital to its equity investors.