Free cash flow volatility remains a primary concern, with margins swinging from a positive 11.1% in 2025Q1 to a negative 27.8% in 2026Q1, reflecting an unsustainable cash burn rate.
| Cash from Operations | -41.43M | 38.07M | -110.68M | -167.17M |
| Operating CF Margin % | - | 5.37% | -20.56% | -41.08% |
| Operating CF Growth % | -310.66% | 134.4% | 33.79% | - |
| Net Income | -716.64M | -679.39M | -354.51M | -344.85M |
| Depreciation & Amortization | 29.3M | 42.52M | 51.54M | 49.55M |
| Stock-Based Compensation | 494.05M | 516.19M | 50.83M | 60.99M |
| Deferred Taxes | 84K | -2.26M | -3.37M | -2.44M |
| Other Non-Cash Items | 184.03M | 161M | 155.29M | 74.86M |
| Working Capital Changes | -32.25M | 0 | -10.47M | -5.27M |
| Change in Receivables | 6.06M | 36.82M | -81.13M | -8.19M |
| Change in Inventory | -318K | 529K | 686K | -5.6M |
| Change in Payables | 18.55M | 11.35M | -4.08M | -7.04M |
| Cash from Investing | -827.35M | -628.65M | 2.24M | 176.95M |
| Capital Expenditures | -17.67M | -22.92M | -33.7M | -30.61M |
| CapEx % of Revenue | 2.35% | 3.23% | 6.26% | 7.52% |
| Acquisitions | 0 | 0 | -2.51M | -13.58M |
| Investments | - | - | - | - |
| Other Investing | -521.31M | -2.78M | -6.7M | -10.52M |
| Cash from Financing | 894.09M | 895.37M | 109.86M | 6.29M |
| Debt Issued (Net) | 0 | 0 | 74.36M | 0 |
| Equity Issued (Net) | 14.65M | 0 | 35.65M | 10.22M |
| Dividends Paid | 0 | 0 | 0 | 0 |
| Share Repurchases | 12.27M | -565K | 0 | 0 |
| Other Financing | 879.44M | 895.37M | -143K | -3.93M |
| Net Change in Cash | 539.17M | 304.78M | 1.43M | 16.07M |
| Free Cash Flow | -58.38M | 15.15M | -151.1M | -208.32M |
| FCF Margin % | -7.75% | 2.14% | -28.07% | -51.2% |
| FCF Growth % | - | 110.03% | 27.47% | - |
| FCF per Share | -0.15 | 0.04 | -0.46 | -0.64 |
| FCF Conversion (FCF/Net Income) | 0.08x | -0.06x | 0.31x | 0.48x |
| Interest Paid | 0 | 0 | 5K | 3K |
| Taxes Paid | 1.97M | 0 | 6.63M | 7.9M |
Unsustainable Cash Burn Rate
Based on reported financial data, the significant divergence between net income and operating cash flow, highlighted by the $410.5 million stock-based compensation charge in 2025Q3, suggests that accounting losses are heavily inflated by non-cash items rather than reflecting pure operational cash outflows.
The persistent gap between net income and operating cash flow indicates that traditional earnings metrics are poor proxies for the company's actual liquidity position. Investors should monitor whether the reliance on stock-based compensation as a primary adjustment continues to mask the underlying cash burn required to sustain the current growth trajectory.
As reported in recent filings, Netskope's free cash flow trajectory remains highly inconsistent, swinging from a positive 11.1% margin in 2025Q1 to a negative 27.8% margin in 2026Q1, which indicates that the business has yet to achieve a stable or predictable cash generation profile.
The volatility in free cash flow suggests that the company's ability to self-fund operations is highly sensitive to quarterly fluctuations in working capital and timing of expenditures. This inconsistency warrants further investigation into whether the business can achieve sustainable positive cash flow without a fundamental shift in its current high-cost operating model.
According to the provided cash flow statements, working capital changes have been erratic, ranging from a $32.3 million inflow in 2025Q1 to a $26.1 million outflow in 2025Q3, suggesting that the company's cash conversion cycle is currently subject to significant quarter-to-quarter variability.
The lack of a consistent trend in working capital management may indicate challenges in aligning customer billing cycles with the heavy infrastructure-related costs of the NewEdge network. Such fluctuations imply that cash availability is heavily dependent on the timing of large enterprise contract renewals rather than steady-state operational efficiency.
Analysis of the cash flow statement reveals that while capital expenditures appear modest relative to revenue, the underlying cost of maintaining the proprietary NewEdge network likely exerts constant pressure on cash reserves, which is not fully captured by the reported depreciation and amortization figures.
The relatively low CapEx-to-revenue ratio may be misleading if the company is relying on operating leases or other off-balance-sheet arrangements to fund its global network expansion. Investors should be cautious, as the true cost of maintaining this competitive advantage may be higher than the reported capital expenditure figures suggest.
Quick answers to the most common questions about buying NTSK stock.
Netskope, Inc. Class A Common Stock (NTSK) generated $38.1M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Netskope, Inc. Class A Common Stock (NTSK) generated $15.2M 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.
Netskope, Inc. Class A Common Stock (NTSK) spent $22.9M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, Netskope, Inc. Class A Common Stock (NTSK) spent $0.6M on share repurchases. This shows the company's commitment to returning capital to its equity investors.