Hyliion Holdings Corp. (HYLN) Cash Flow Statement

The gap between net income and operating cash flow is driven by non-cash items such as depreciation and stock-based compensation, which added roughly $2-3 million per quarter. However, working capital swings have been volatile, with a $13.1 million outflow in 2024Q1 and a $4.4 million inflow in 2026Q2, suggesting that cash conversion is not yet stable. Investors should monitor whether the positive working capital contribution in 2026Q2 is a one-time event or a sustainable trend.

The FCF margin improved to -147.7% in 2026Q2 from -5.2% in 2026Q1, but this is due to a revenue jump to $4.9 million, not a reduction in cash burn. The absolute FCF deficit has narrowed from -$25.5 million in 2024Q1 to -$7.3 million in 2026Q2, suggesting some cost discipline, yet the company remains far from self-funding. The trajectory appears to be improving, but the base is so small that any revenue hiccup could reverse the trend.

Capex as a percentage of revenue is highly volatile, ranging from 2.4% to 66.2%, reflecting the low revenue base. The 2025Q3 spike suggests investment in production capacity, but the subsequent decline to $212K in 2026Q2 may indicate a pause or completion of initial tooling. Given the company's pre-revenue stage, most capex appears growth-oriented, but investors should watch for any maintenance capex needs as the KARNO generator moves to commercial production.

The large negative working capital in 2024Q1 likely reflects inventory write-downs or payables timing, while the positive swing in 2026Q2 may indicate improved collections or reduced inventory. However, the inconsistency makes it difficult to discern a clear trend, and the company's minimal revenue means working capital efficiency is not yet meaningful. Investors should monitor whether the positive contribution in 2026Q2 is sustainable or a one-off.

Capital deployment is entirely directed toward funding operations and small acquisitions, with no returns to shareholders. The $1.6 million acquisition in 2026Q2 is minor but suggests management is still investing in strategic assets. Given the persistent cash burn, the lack of buybacks or dividends is prudent, but it also means shareholders are relying solely on future value creation from the KARNO technology.

The cumulative gap between net income and operating cash flow is relatively small, indicating that reported losses are a good proxy for cash consumption. However, the gap is not consistent, with some quarters showing OCF/NI above 1.0 (2026Q1 and 2024Q1) due to working capital outflows, and others below 1.0 due to non-cash add-backs. This suggests that the company's cash burn is real and not masked by aggressive accruals, but the volatility in working capital warrants close monitoring.