Cash generation remains strained, as evidenced by a negative $320.4 million free cash flow in 2026Q1 and a low OCF/NI conversion ratio of 0.17.
| Cash from Operations | 3.01B | 3.27B | 1.94B | 2.07B | 2.86B | 1.2B | 320.89M | 293.44M | -12.91M | -174.61M | -150.23M | -80.3M | 27.94M |
| Operating CF Margin % | - | 29.44% | 18.78% | 20.74% | 30.65% | 15.37% | 5.59% | 7.12% | -0.46% | -10.8% | -14.23% | -11.41% | 5.97% |
| Operating CF Growth % | 61.55% | 68.88% | -6.14% | -27.74% | 137.9% | 274.39% | 9.35% | 2372.94% | 92.61% | -16.23% | -87.09% | -387.43% | - |
| Net Income | 2.83B | 923.77M | 3.43B | -4.29B | -1.27B | -1.19B | -669.21M | -442.08M | -430.27M | -326.9M | -276.41M | -98.58M | -130M |
| Depreciation & Amortization | 3.44B | 3.37B | 3.35B | 3.63B | 3.19B | 2.62B | 1.64B | 1.14B | 741.51M | 378.13M | 227.35M | 145.41M | 82.75M |
| Stock-Based Compensation | 61.2M | 0 | 296.49M | 336.62M | 290.81M | 391.27M | 333.69M | 189.76M | 105.88M | 59.84M | 64.17M | 4.06M | 27.33M |
| Deferred Taxes | 0 | 0 | 0 | -295.93M | -99.15M | -48.46M | -89.74M | -50.17M | -36.6M | -11.62M | -10.62M | -10.59M | -5.02M |
| Other Non-Cash Items | -2.31B | -1.11B | -4.59B | 3.17B | 69.36M | 242.76M | 131.11M | 100.16M | 63.83M | 48.1M | 3.7M | -11.91M | -26.51M |
| Working Capital Changes | -1.01B | 91.42M | -543.7M | -484.86M | 674.09M | -809.89M | -1.02B | -646.26M | -457.25M | -322.16M | -158.41M | -120.59M | 79.39M |
| Change in Receivables | 0 | 0 | -665.88M | -156.33M | -678.83M | -37.99M | -465.19M | -342.19M | -157.71M | -134.63M | -79.38M | -37.65M | -11.85M |
| Change in Inventory | 0 | 0 | 0 | 0 | 0 | -847.05M | -692.71M | -359.33M | -303.71M | -285.72M | -119.56M | -89.9M | 80.95M |
| Change in Payables | 0 | 0 | -15.63M | 17.98M | 189.71M | 35.5M | 119.16M | 22.54M | 25.29M | 33.9M | 43.84M | -5.15M | -6.76M |
| Cash from Investing | -3.45B | -2.96B | -8.76B | -6.33B | -11.27B | -13.69B | -9.38B | -5.13B | -4.73B | -2.04B | -1.15B | -731.9M | -523.75M |
| Capital Expenditures | -4.35B | -4.48B | -2.97B | -6.25B | -7.8B | -9.7B | -8.02B | -4.55B | -4.26B | -1.76B | -987.7M | -732.98M | -248.35M |
| CapEx % of Revenue | 36.19% | 40.33% | 28.73% | 62.81% | 83.68% | 124.05% | 139.76% | 110.44% | 152.5% | 108.91% | 93.54% | 104.17% | 53.03% |
| Acquisitions | 2.62B | 0 | 1.13B | -133.81M | -3.47B | -4.01B | -1.36B | -578.61M | -475.07M | -275.61M | -159.36M | 0 | 27.41M |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -3.74B | 2.18B | -6.92B | 61.3M | 6.24M | 20.87M | 4.5M | -30.7M | -1M | -6.03M | -42M | 1.07M | -302.81M |
| Cash from Financing | 7.67B | 5.94B | 17.06B | 3.14B | 4.86B | 8.12B | 20.14B | 8.36B | 4.88B | 2.35B | 2.13B | 1.13B | 1.06B |
| Debt Issued (Net) | 0 | 0 | 83.24M | 3.24B | 4.98B | 7.02B | 3.18B | 2.38B | 3.82B | 1.79B | 1.04B | 1.17B | 126.88M |
| Equity Issued (Net) | 0 | 0 | 0 | 0 | 0 | 0 | 15.97B | 5.92B | 0 | 0 | 0 | 0 | -119.66M |
| Dividends Paid | 0 | 0 | -54.17M | -53.92M | -51.58M | -49.22M | -65.49M | -25.01M | 0 | 0 | -76.5M | 0 | 0 |
| Share Repurchases | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -23.3M | -119.66M |
| Other Financing | 7.67B | 5.94B | 17.06B | -44.86M | -68.45M | 1.15B | 1.06B | 81.41M | 1.05B | 566.61M | 1.16B | -44.69M | 1.05B |
| Net Change in Cash | 7.47B | 6.71B | 10.22B | -964.13M | -3.14B | -4.47B | 10.52B | 3.69B | 337.15M | 62.13M | 886.82M | 317.74M | 558.15M |
| Free Cash Flow | -1.34B | -1.21B | -1.32B | -4.19B | -4.95B | -8.5B | -7.7B | -4.26B | -4.27B | -1.93B | -1.14B | -813.28M | -220.41M |
| FCF Margin % | -11.16% | -10.89% | -12.75% | -42.07% | -53.03% | -108.69% | -134.16% | -103.32% | -152.96% | -119.71% | -107.76% | -115.58% | -47.06% |
| FCF Growth % | 61.07% | 7.96% | 68.58% | 15.31% | 41.8% | -10.36% | -80.78% | 0.27% | -120.74% | -70.03% | -39.92% | -268.98% | - |
| FCF per Share | -5.28 | -5.89 | -7.17 | -22.82 | -27.02 | -46.79 | -49.14 | -30.89 | -34.50 | -19.73 | -30.44 | -16.84 | -64.71 |
| FCF Conversion (FCF/Net Income) | -0.47x | 3.54x | 0.57x | -0.48x | -2.26x | -1.01x | -0.48x | -0.66x | 0.03x | 0.53x | 0.54x | 0.81x | -0.21x |
| Interest Paid | 0 | 0 | 2.1B | 2.06B | 1.8B | 1.54B | 1.11B | 841.39M | 633.06M | 358.75M | 228.68M | 81.22M | 55.15M |
| Taxes Paid | 0 | 0 | 389.84M | 302.72M | 343.35M | 252.07M | 211.61M | 17.03M | 3.37M | 1.37M | 5.64M | 853K | 443K |
Capital intensity and leverage
As reported in recent financial statements, GDS exhibits a persistent disconnect between net income and operating cash flow, evidenced by an OCF/NI ratio of 0.17 in 2026Q1, which suggests that reported profits are not currently translating into meaningful cash generation for the core business operations.
The wide variance between net income and operating cash flow indicates that non-cash items and accounting adjustments are significantly inflating bottom-line figures. Investors should monitor this divergence closely, as it implies that the company's reported profitability may not reflect the underlying cash-generating capacity of its data center assets.
Based on the provided quarterly data, GDS has struggled to maintain positive free cash flow, recording a negative $320.4 million in 2026Q1, which highlights the ongoing challenge of funding massive infrastructure expansion through internal cash generation rather than relying on external financing or equity dilution.
The persistent negative FCF trajectory suggests that the company's capital-intensive growth strategy continues to outpace its operational cash inflows. This trend warrants further investigation into whether the company can reach a self-sustaining cash flow profile as its current data center capacity matures and utilization rates improve.
According to the latest quarterly filings, GDS maintained a high capital expenditure intensity, with CapEx/Revenue reaching 22.9% in 2026Q1, underscoring the heavy financial burden required to maintain and expand its specialized hyperscale infrastructure footprint in highly competitive Tier 1 Chinese markets.
The elevated level of capital spending relative to revenue suggests that the company is still in a heavy investment phase, likely prioritizing market share over immediate cash flow generation. This capital intensity appears to be a structural necessity, given the specialized power and cooling requirements of the hyperscale cloud providers it serves.
As indicated by the reported figures, GDS experienced a significant working capital outflow of $1.0 billion in 2026Q1, a sharp reversal from previous periods, which suggests that timing differences in customer collections and project-related payables are creating substantial, unpredictable swings in the company's short-term liquidity position.
The erratic nature of working capital changes may indicate challenges in managing the billing cycle for large-scale hyperscale contracts. Investors should monitor whether these fluctuations are temporary timing issues or symptomatic of broader difficulties in converting contracted backlog into timely cash receipts.
Quick answers to the most common questions about buying GDS stock.
GDS Holdings Limited (GDS) generated $3.27B in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
GDS Holdings Limited (GDS) reported negative free cash flow of $1.21B in 2025, indicating capital requirements exceeded cash from operations.
GDS Holdings Limited (GDS) spent $4.48B on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.