Free cash flow has plummeted to a -130.5% margin, with a $2.6M outflow in working capital further exacerbating the firm's liquidity burn.
| Cash from Operations | -5.72M | -135.66K | 391.88K | -571.45K | 745.8K | -65.53K |
| Operating CF Margin % | -58.33% | -1.34% | 3.53% | -6.17% | 6.45% | -2.2% |
| Operating CF Growth % | -4115.71% | -134.62% | 168.58% | -176.62% | 1238.18% | - |
| Net Income | -10.87M | -1.48M | 162.23K | 132.69K | 1.07M | 207.86K |
| Depreciation & Amortization | 571.26K | 52.97K | 134.79K | 118.56K | 130.83K | 115.94K |
| Stock-Based Compensation | 5.16M | 0 | 0 | 0 | 0 | 0 |
| Deferred Taxes | -68.03K | 0 | 0 | 0 | 0 | 0 |
| Other Non-Cash Items | 2.09M | 1.87M | 609.83K | 65.76K | -266.13K | 1.25M |
| Working Capital Changes | -2.6M | -581.46K | -514.97K | -888.46K | -185.44K | -1.64M |
| Change in Receivables | -739.54K | -3.03M | 1.08M | -1.21M | -714.03K | -1.3M |
| Change in Inventory | -234.75K | -60.04K | 0 | 159.46K | 466.16K | -636.47K |
| Change in Payables | -930.2K | 0 | 0 | 0 | 0 | 0 |
| Cash from Investing | -2.29M | 0 | 0 | 0 | 19.57K | -21.64K |
| Capital Expenditures | -6.47K | 0 | 0 | 0 | -3.48K | -40.91K |
| CapEx % of Revenue | 0.07% | - | - | - | 0.03% | 1.37% |
| Acquisitions | 17.33K | 0 | 0 | 0 | 0 | 0 |
| Investments | - | - | - | - | - | - |
| Other Investing | -2.3M | 0 | 0 | 0 | 23.05K | 19.27K |
| Cash from Financing | 9.36M | 10.87K | -152.91K | -125.58K | -30.23K | 176.52K |
| Debt Issued (Net) | 876.21K | 0 | -132.03K | 45.21K | -97.6K | 181.23K |
| Equity Issued (Net) | 10.35M | 0 | 0 | 0 | 0 | 0 |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Financing | -1.87M | 10.87K | -20.88K | -170.79K | 67.37K | -4.71K |
| Net Change in Cash | 1.35M | -109.32K | 222.9K | -740.23K | 735.48K | 306.46K |
| Free Cash Flow | -8.03M | -135.66K | 391.88K | -571.45K | 742.32K | -106.43K |
| FCF Margin % | -81.85% | -1.34% | 3.53% | -6.17% | 6.42% | -3.58% |
| FCF Growth % | -5815.95% | -134.62% | 168.58% | -176.98% | 797.46% | - |
| FCF per Share | -0.47 | -0.01 | 0.03 | -0.04 | 0.05 | -0.01 |
| FCF Conversion (FCF/Net Income) | 0.53x | 0.09x | 2.42x | -4.31x | 0.70x | -0.32x |
| Interest Paid | 10.04K | 0 | 5.78K | 9.68K | 13.99K | 0 |
| Taxes Paid | 0 | 289 | 578 | 1.62K | 0 | 0 |
Imminent liquidity and solvency risk
According to 2025Q4 financial disclosures, NTCL reported a net loss of $5.9M alongside an operating cash outflow of $5.7M, a relationship heavily influenced by $5.2M in stock-based compensation that masks the underlying cash-generating weakness inherent in the firm's current operational structure.
The narrow gap between net income and operating cash flow is misleading, as it is artificially narrowed by non-cash stock-based compensation rather than genuine operational efficiency. Investors should monitor this trend, as the reliance on equity-based incentives to preserve cash suggests that the core business lacks the organic profitability required to sustain its current cost base.
As reported in recent quarterly filings, NTCL's free cash flow margin plummeted to -130.5% in 2025Q4, reflecting a rapid deterioration in the company's ability to convert revenue into liquidity while operating expenses continue to outpace the firm's limited top-line generation.
The trajectory of free cash flow indicates a business model that is currently consuming capital at an accelerating rate. This trend warrants further investigation, as the inability to generate positive cash flow from operations suggests that the company may be forced to rely on external financing to maintain its ongoing development activities.
Based on the 2025Q4 cash flow statement, NTCL experienced a $2.6M outflow related to working capital changes, which significantly exacerbated the company's cash burn and highlights the difficulty in managing collections within its institutional client base.
The negative working capital movement suggests that the company is struggling to collect receivables or is being forced to tie up cash in operational cycles that do not yield immediate liquidity. This dynamic appears to be a primary driver of the firm's current cash crunch, as the timing of cash inflows fails to align with the company's fixed expenditure requirements.
Financial statements reveal that NTCL's cash position of $1.76M is insufficient to cover the $5.7M operating cash outflow observed in the most recent quarter, suggesting that the company's reported cash flow figures obscure a precarious liquidity position that may necessitate immediate capital intervention.
The reliance on stock-based compensation to manage the cash flow statement may be obscuring the true extent of the company's operational distress. Analysts should be wary of the disconnect between the reported cash balance and the burn rate, as the current trajectory appears to be unsustainable without a significant shift in operational strategy or external support.
Quick answers to the most common questions about buying NTCL stock.
NetClass Technology Inc (NTCL) generated $-5.7M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
NetClass Technology Inc (NTCL) reported negative free cash flow of $8.0M in 2025, indicating capital requirements exceeded cash from operations.
NetClass Technology Inc (NTCL) spent $0.0M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.