Free cash flow margins reached 38.7% in 2026Q1, supported by an operating cash flow to net income ratio of 2.50, indicating strong conversion of accounting profits into liquidity.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 | Dec'05 | Dec'04 | Dec'03 | Dec'02 | Dec'01 | Dec'00 | Dec'99 | Dec'98 | Dec'97 | Dec'96 |
|---|
| Cash from Operations | 73.14M | 46.75M | 35.02M | 5.9M | -1.22M | 5.15M | 5.66M | 4.28M | 3.6M | 738K | -2.73M | 2.66M | 4.61M | 621K | 17.77M | -2.98M | 4.86M | 12.1M | 4.5M | 6M | -3.45M | 1.14M | 15.67M | 682K | 3.05M | 4.84M | 12.39M | 2.9M | 2.5M | 1.1M | 900K |
| Operating CF Margin % | - | 18.58% | 20.54% | 6.8% | -1.54% | 7.38% | 9.72% | 7.66% | 6.28% | 1.21% | -4.34% | 4.54% | 7.81% | 0.97% | 20.52% | -4.03% | 7.9% | 15.25% | 6.01% | 8.85% | -8.43% | 2.7% | 29.04% | 1.86% | 8.38% | 8.3% | 24.42% | 10.55% | 12.76% | 5.47% | 4.39% |
| Operating CF Growth % | 1315.07% | 33.52% | 493.17% | 585.44% | -123.61% | -8.99% | 32.24% | 18.76% | 388.35% | 126.98% | -202.86% | -42.36% | 642.83% | -96.5% | 696.14% | -161.34% | -59.83% | 168.54% | -24.9% | 273.62% | -404.05% | -92.75% | 2197.51% | -77.64% | -36.98% | -60.93% | 327.14% | 16% | 127.27% | 22.22% | 28.57% |
| Net Income | 39.29M | 32.18M | 28.68M | -889K | -12.01M | -1.67M | 617K | -2.14M | 11K | -5.36M | -5.91M | -3.38M | -1.93M | -12.84M | 5.69M | 3.91M | -747K | 7.31M | 7.58M | 4.57M | -7.32M | -1.65M | 7.86M | 475K | -5.17M | 1.35M | 6.17M | 2.1M | 2.3M | -4.2M | -600K |
| Depreciation & Amortization | 7.5M | 6.89M | 5.8M | 4.72M | 3.89M | 2.87M | 2.27M | 2.7M | 3.37M | 3.67M | 3.19M | 2.77M | 3.05M | 3.65M | 3.9M | 3.41M | 3.7M | 3.71M | 3.7M | 3.16M | 3.44M | 3.16M | 3.92M | 4.53M | 5.23M | 4.79M | 2.96M | 1.8M | 1.3M | 1.3M | 1.4M |
| Stock-Based Compensation | 14.17M | 11.14M | 4M | 4.03M | 3.28M | 0 | 0 | 0 | 796K | 695K | 1.16M | 1.33M | 1.16M | 935K | 977K | 815K | 256K | 204K | 220K | 174K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 1.2M | 0 | 0 | 0 |
| Deferred Taxes | 2.03M | 4.1M | -5.61M | -276K | 217K | 88K | -618K | -313K | 175K | -255K | -159K | -157K | -383K | 4.62M | -762K | -767K | -1.62M | -607K | -3.58M | -87K | -222K | 215K | 815K | -2K | 30K | -463K | 574K | -200K | -500K | 400K | -200K |
| Other Non-Cash Items | 1.52M | 1.45M | 2.04M | 1.47M | 1.55M | 1.54M | 1.78M | 1.15M | 1.15M | 106K | 1.28M | 431K | 1.09M | 6.04M | 1.17M | 78K | 41K | 1.76M | 439K | 667K | 241K | 97K | 36K | 936K | 866K | 4.75M | 825.45K | -100K | -400K | 2.9M | 0 |
| Working Capital Changes | 8.63M | -9.01M | 114K | -3.15M | 1.85M | 2.32M | 1.62M | 2.88M | -1.9M | 1.88M | -2.3M | 1.67M | 1.63M | -1.79M | 6.79M | -10.43M | 3.22M | -291K | -3.86M | -2.48M | 413K | -685K | 3.04M | -5.25M | 2.09M | -5.59M | 1.86M | -1.9M | -200K | 700K | 300K |
| Change in Receivables | -16.64M | -18.35M | -14.69M | -5.12M | 1.3M | -1.87M | -481K | 1.22M | -533K | -40K | 17K | 1.04M | 1.87M | 2.44M | 7.39M | -12.89M | 3.69M | 912K | -3.34M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Change in Inventory | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -826K | 580K | -444K | 543K | -401K | -2.05M | -267K | 733K | 822K | -1.18M | 566K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Change in Payables | 20.78M | 9.5M | 3.43M | 353K | 322K | 4.44M | 155K | -589K | -779K | 1.59M | -1.75M | 132K | 160K | -999K | 90K | 673K | -406K | 208K | -920K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Cash from Investing | -11.18M | -11.1M | -7.74M | -5.07M | -7.03M | -4.37M | -1.38M | -1.67M | -2.03M | -3.41M | -6.97M | -697K | -5.41M | -689K | -4.11M | 2.16M | -15.75M | -2.17M | -2.45M | -4.45M | -2.33M | -2.33M | -1.05M | -3.41M | -1.16M | -6.36M | -7.4M | -3.9M | -800K | -1M | -400K |
| Capital Expenditures | -11.18M | -11.1M | -7.74M | -5.56M | -6.53M | -4.37M | -1.41M | -1.67M | -2.03M | -3.41M | -2.74M | -697K | -2.03M | -3.78M | -6.84M | -5.89M | -1.87M | -2.17M | -2.45M | -4.45M | -2.33M | -2.33M | -2.05M | -2.41M | -1.16M | -5.57M | -7.4M | -3.9M | -1M | -1M | -1.2M |
| CapEx % of Revenue | 3.94% | 4.41% | 4.54% | 6.41% | 8.26% | 6.26% | 2.43% | 2.98% | 3.54% | 5.6% | 4.34% | 1.19% | 3.44% | 5.88% | 7.9% | 7.96% | 3.04% | 2.73% | 3.27% | 6.57% | 5.69% | 5.55% | 3.8% | 6.56% | 3.19% | 9.55% | 14.59% | 14.18% | 5.1% | 4.98% | 5.85% |
| Acquisitions | 0 | 0 | 0 | 0 | 0 | 0 | 39K | 0 | 0 | 0 | -4.23M | 0 | -3.38M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -796K | 0 | 0 | 0 | 0 | 0 |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 3.09M | 2.74M | 8.05M | 0 | 0 | 0 | 0 | 0 | 0 | 1M | -1M | 0 | 0 | 0 | 0 | 200K | 0 | -400K |
| Cash from Financing | -385K | -426K | 6.06M | 2.87M | -307K | 773K | 2.31M | -2.4M | -2.03M | -284K | -837K | -1.13M | 422K | -605K | 379K | -1.91M | -1.47M | 2.68M | -2.93M | -394K | -679K | 595K | 994K | 522K | -900K | -1.25M | 676.31K | 900K | -100K | -200K | 100K |
| Debt Issued (Net) | 103K | 0 | -513K | -452K | -639K | -691K | -284K | -567K | -2.02M | -284K | 0 | 0 | 71K | -677K | 0 | -585K | -699K | -784K | -1.13M | -849K | -716K | -702K | -88K | -49K | -650K | 0 | -25K | -100K | -100K | -200K | -100K |
| Equity Issued (Net) | 957K | 3.33M | 6.67M | 0 | 0 | 2.23M | 2.6M | -1.83M | -2K | 0 | -134K | -200K | 0 | 0 | 0 | -1.33M | -772K | 0 | -1.87M | 455K | 37K | 1.3M | 1.08M | 571K | -250K | -1.25M | 701K | 900K | 0 | 0 | 100K |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -1.84M | 0 | 0 | -134K | -200K | 0 | 0 | 0 | -1.33M | -772K | 0 | -1.87M | 0 | -319K | 0 | 0 | 0 | -360K | -1.64M | 0 | 0 | 0 | 0 | 0 |
| Other Financing | -1.45M | -3.76M | -97K | 3.32M | 332K | -763K | 0 | 0 | 0 | 0 | -703K | -930K | 351K | 72K | 379K | 0 | 0 | 3.46M | 71K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 310 | 100K | 0 | 0 | 100K |
| Net Change in Cash | 60.81M | 35.33M | 33.08M | 4.01M | -9.11M | 1.33M | 6.7M | 5K | -538K | -2.77M | -10.74M | 692K | -536K | -673K | 14.04M | -2.73M | -12.36M | 12.61M | -876K | 1.15M | -6.46M | -604K | 15.61M | -2.2M | 988K | -2.77M | 5.66M | -100K | 1.6M | -100K | 600K |
| Free Cash Flow | 61.97M | 35.65M | 27.27M | 339K | -7.74M | 783K | 4.25M | 2.61M | 1.57M | -2.67M | -5.47M | 1.96M | 2.58M | -3.16M | 10.92M | -8.87M | 2.99M | 9.93M | 2.05M | 1.55M | -5.78M | -1.2M | 13.62M | -1.73M | 1.89M | -728K | 4.98M | -1M | 1.5M | 100K | -300K |
| FCF Margin % | 21.87% | 14.16% | 16% | 0.39% | -9.8% | 1.12% | 7.29% | 4.68% | 2.74% | -4.39% | -8.68% | 3.35% | 4.37% | -4.92% | 12.61% | -11.99% | 4.85% | 12.51% | 2.74% | 2.29% | -14.12% | -2.85% | 25.24% | -4.7% | 5.19% | -1.25% | 9.82% | -3.64% | 7.65% | 0.5% | -1.46% |
| FCF Growth % | 104.09% | 30.7% | 7945.43% | 104.38% | -1088.76% | -81.56% | 62.5% | 66.33% | 158.79% | 51.2% | -379.05% | -23.95% | 181.67% | -128.93% | 223.17% | -396.92% | -69.92% | 383.77% | 32.56% | 126.77% | -382.32% | -108.8% | 888.99% | -191.42% | 359.34% | -114.61% | 598.37% | -166.67% | 1400% | 133.33% | 40% |
| FCF per Share | 1.74 | 1.02 | 0.85 | 0.01 | -0.28 | 0.03 | 0.17 | 0.10 | 0.06 | -0.10 | -0.21 | 0.08 | 0.10 | -0.13 | 0.42 | -0.35 | 0.12 | 0.39 | 0.08 | 0.06 | -0.24 | -0.05 | 0.55 | -0.07 | 0.09 | -0.03 | 0.22 | -0.05 | 0.08 | 0.01 | -0.02 |
| FCF Conversion (FCF/Net Income) | 1.58x | 1.45x | 1.22x | -6.50x | 0.10x | -3.08x | 9.17x | -2.00x | -14.25x | -0.15x | 0.50x | -0.94x | -4.74x | -0.06x | 2.38x | -0.67x | -6.50x | 1.65x | 0.59x | 1.31x | 0.47x | -0.69x | 1.99x | 1.44x | -0.59x | 3.59x | 2.01x | 1.38x | 1.09x | -0.26x | -1.50x |
| Interest Paid | 20K | 0 | 287K | 400K | 19K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 9K | 28K | 56K | 33K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | -112K | 0 | 2.42M | 753K | 1.11M | 0 | 0 | 0 | 680K | 1.09M | 1.31M | 1.06M | 957K | 1.57M | 1.79M | 1.08M | 308K | 2.19M | 1.1M | 325K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Hyperscaler revenue concentration risk
According to recent financial filings, Innodata's operating cash flow to net income ratio reached 2.50 in 2026Q1, suggesting that the company is successfully converting accounting profits into tangible cash, though investors should monitor whether this high conversion rate is sustainable or driven by temporary working capital shifts.
The significant divergence between net income and operating cash flow suggests that the company's earnings quality is currently supported by favorable cash timing. This trend warrants further investigation into whether these inflows represent permanent operational efficiency or merely the front-loading of payments from large-scale AI contracts.
As reported in quarterly statements, Innodata's free cash flow margin surged to 38.7% in 2026Q1, reflecting a dramatic improvement from the negative margins observed in late 2023 and suggesting that the company is effectively scaling its AI-centric business model to generate substantial excess liquidity.
The trajectory of free cash flow indicates that the company has moved past the initial heavy investment phase required to pivot its service offerings. However, the volatility in previous quarters suggests that this margin profile may remain sensitive to the timing of large project milestones and client payment cycles.
Based on reported figures, working capital changes contributed a positive $15.8M to cash flow in 2026Q1, a sharp reversal from the negative trends seen in previous periods, which may indicate improved collection efficiency or a shift in the timing of milestone-based revenue recognition from major clients.
The recent positive working capital swing appears to be a primary driver of the company's current cash strength. Analysts should monitor whether this reflects a permanent improvement in receivables management or if it is a temporary benefit from the specific payment terms of current high-growth AI engagements.
Innodata's capital expenditure as a percentage of revenue remained low at 2.7% in 2026Q1, according to recent data, which suggests that the company's business model remains relatively asset-light despite the significant scaling of its data engineering workforce and proprietary AI-enabled toolsets.
The low capital intensity implies that the company does not require heavy physical infrastructure to support its growth, which is a positive signal for long-term margin stability. Investors should monitor if future growth necessitates higher investment in proprietary technology to maintain its competitive edge against lower-cost service providers.
Quick answers to the most common questions about buying INOD stock.
Innodata Inc. (INOD) generated $46.8M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Innodata Inc. (INOD) generated $35.6M 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.
Innodata Inc. (INOD) spent $11.1M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.