GSI Technology, Inc. (GSIT) Cash Flow Statement

The ratio of operating cash flow to net income is distorted by near-zero or negative denominators, so the raw multiple should not be read as a conversion rate. The more meaningful observation is that operating cash outflows persist even in quarters where net income approaches breakeven, such as 2025Q1, suggesting non-cash add-backs like stock-based compensation of roughly $0.3M to $0.9M per quarter are cushioning reported results rather than reflecting genuine earnings quality. Investors should monitor whether cash losses narrow as operating losses are addressed.

Free cash flow has been negative in every reported period, and the margin trajectory shows no sustained improvement, with the 2026Q2 period at -14.1% as a rare relative bright spot driven by a working capital inflow rather than operating improvement. Capital expenditure is minimal, at under 6% of revenue in every quarter, so the burn is driven almost entirely by operating losses rather than investment spending. This indicates the cash problem is operational, not a function of heavy capital intensity.

The absence of dividends and buybacks is consistent with a company consuming cash rather than generating surplus, which is the appropriate posture given negative free cash flow. The only notable deployment-related entry is a net acquisition outflow of $11.3M in 2025Q2, which warrants further investigation as to its strategic rationale and whether it contributed to the subsequent cash consumption. Investors should monitor how the balance sheet cash cushion is being drawn down against continued operating burn.