Cash generation remains inconsistent, evidenced by a 2026Q1 working capital outflow of $40.9M and a dividend payout policy that persists despite periods of negative free cash flow.
| Cash from Operations | 182.4M | 191.7M | 35.7M | 67.7M | 412.2M | 456M | 498.5M | 505M |
| Operating CF Margin % | - | 17.74% | 3.18% | 6.04% | 36.49% | 39.14% | 45.92% | 45.54% |
| Operating CF Growth % | 4506.98% | 436.97% | -47.27% | -83.58% | -9.61% | -8.53% | -1.29% | - |
| Net Income | 111.9M | 95.4M | 78.3M | 70.4M | 223.6M | 415M | 427.6M | 432M |
| Depreciation & Amortization | 37.8M | 40.7M | 36.2M | 32.6M | 31.7M | 38M | 38.3M | 36M |
| Stock-Based Compensation | 11.8M | 31.6M | 26.3M | 21.5M | 18.7M | 12.8M | 12.7M | 12M |
| Deferred Taxes | 15.4M | 17.6M | -70.6M | 14.3M | -26.5M | -2M | -2.2M | -6M |
| Other Non-Cash Items | 1.2M | 30.1M | 13.2M | 8.9M | 72.3M | 24.2M | 9.4M | 9M |
| Working Capital Changes | 200K | -23.7M | -47.7M | -80M | 92.4M | -32M | 12.7M | 22M |
| Change in Receivables | 28.5M | 44.2M | -174.7M | 7M | 122.7M | -32M | -2.4M | -10M |
| Change in Inventory | -7.6M | -6.1M | -16.5M | -28.8M | -23.4M | -18M | 3.5M | 9M |
| Change in Payables | -32.2M | -68.9M | 60M | 7.9M | 73.3M | 30M | -3.8M | 32M |
| Cash from Investing | 1.8M | -9.3M | -15.8M | -26.5M | -24M | -39M | -41.9M | -69M |
| Capital Expenditures | -8.3M | -9.3M | -15.8M | -26.5M | -24M | -39M | -41.9M | -69M |
| CapEx % of Revenue | 0.8% | 0.86% | 1.41% | 2.36% | 2.12% | 3.35% | 3.86% | 6.22% |
| Acquisitions | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Investments | - | - | - | - | - | - | - | - |
| Other Investing | 10.1M | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Cash from Financing | -195.8M | -226.7M | -73.4M | -48.7M | -48M | -417M | -456.6M | -436M |
| Debt Issued (Net) | -201.4M | -186M | -35.9M | -10.7M | 1.44B | 0 | 0 | 0 |
| Equity Issued (Net) | -200K | -5.7M | -3M | -3.6M | 0 | 0 | 0 | 0 |
| Dividends Paid | -35.3M | -35M | -34.5M | -34.4M | -8.6M | 0 | 0 | 0 |
| Share Repurchases | -200K | -5.7M | -3M | -3.6M | 0 | 0 | 0 | 0 |
| Other Financing | 41.1M | 0 | 0 | 0 | -1.48B | -417M | -456.6M | -436M |
| Net Change in Cash | -18.9M | -45.6M | -52.3M | -4.4M | 330.9M | 0 | 0 | 0 |
| Free Cash Flow | 174.1M | 182.4M | 19.9M | 41.2M | 388.2M | 417M | 456.6M | 436M |
| FCF Margin % | 16.7% | 16.88% | 1.77% | 3.68% | 34.37% | 35.79% | 42.06% | 39.31% |
| FCF Growth % | 338.54% | 816.58% | -51.7% | -89.39% | -6.91% | -8.67% | 4.72% | - |
| FCF per Share | 2.96 | 3.10 | 0.34 | 0.71 | 6.80 | 7.34 | 8.01 | 7.65 |
| FCF Conversion (FCF/Net Income) | 1.56x | 2.01x | 0.46x | 0.96x | 1.84x | 1.10x | 1.17x | 1.17x |
| Interest Paid | 0 | 103.8M | 117.7M | 111M | 38.9M | 0 | 0 | 0 |
| Taxes Paid | 0 | 50.1M | 29.1M | 30.4M | 15.6M | 0 | 0 | 0 |
Working capital volatility
As reported in financial statements, Embecta's operating cash flow to net income ratio has exhibited extreme variance, ranging from a negative 0.65 in 2024Q1 to a high of 7.57 in 2025Q1, suggesting that reported earnings are currently an unreliable proxy for the company's actual cash-generating capacity.
The significant divergence between net income and operating cash flow indicates that non-cash items and working capital swings are heavily distorting the bottom line. Investors should monitor whether this instability is a temporary byproduct of the spin-off transition or a structural feature of the company's current accounting practices.
Based on Embecta's reported figures, free cash flow margins have fluctuated wildly from a negative 5.7% in 2024Q1 to a peak of 29.1% in 2025Q4, reflecting a business model that struggles to maintain a predictable conversion of revenue into spendable cash for shareholders.
The inability to sustain positive free cash flow across consecutive quarters suggests that the company's core operations are highly sensitive to external pressures. This inconsistency complicates the firm's ability to fund its R&D pivot toward patch pump technology without potentially straining its liquidity position.
According to recent SEC filings, Embecta has experienced massive quarterly shifts in working capital, including a $40.9 million outflow in 2026Q1, which suggests that the company's cash flow is being heavily impacted by the timing of inventory management and distributor payment cycles.
These large swings in working capital appear to be the primary driver of the company's erratic cash flow profile. The volatility warrants further investigation into whether these movements represent genuine operational challenges or merely the timing of large-scale international tenders and wholesaler stocking patterns.
As evidenced by the cash flow statement, Embecta has consistently paid out approximately $8.6 million to $8.9 million in dividends per quarter, even during periods of negative free cash flow, which may indicate a management commitment to shareholder returns that exceeds current operational cash generation.
Maintaining a steady dividend while the company faces revenue contraction and negative net income appears to be a risky capital allocation strategy. This approach may limit the financial flexibility required to navigate the competitive transition into the wearable insulin pump market.
Quick answers to the most common questions about buying EMBC stock.
Embecta Corp. (EMBC) generated $191.7M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Embecta Corp. (EMBC) generated $182.4M 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.
Embecta Corp. (EMBC) spent $9.3M 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, Embecta Corp. (EMBC) returned $35.0M to shareholders via cash dividends and spent $5.7M on share repurchases. This shows the company's commitment to returning capital to its equity investors.