Free cash flow remains consistently negative, with the company burning through $10.3 million in 2026Q1, reflecting a structural inability to convert net income into sustainable operating cash flow.
| Cash from Operations | -30.36M | -27.64M | -22.63M | -76.62M | -65.39M | -42.1M | -16.88M |
| Operating CF Margin % | - | -526.82% | -290.61% | -1246.66% | -448.84% | -829.62% | -191.56% |
| Operating CF Growth % | -134.84% | -22.14% | 70.47% | -17.17% | -55.31% | -149.4% | - |
| Net Income | -25.33M | 10.04M | -72.62M | -115.59M | -157.13M | -81.51M | -20.93M |
| Depreciation & Amortization | 948K | 1.09M | 825K | 4.38M | 3.59M | 531K | 458K |
| Stock-Based Compensation | 2.24M | 4.45M | 2.81M | 12.04M | 35.65M | 43.12M | 2.29M |
| Deferred Taxes | -2.54M | -2.54M | 0 | 0 | 0 | 0 | 0 |
| Other Non-Cash Items | -18.35M | -39.13M | 47.15M | 27.88M | 55.3M | 533K | 0 |
| Working Capital Changes | 60K | -1.55M | -785K | -5.33M | -2.8M | -4.78M | 1.29M |
| Change in Receivables | 53K | 136K | 991K | 3.44M | -2.23M | 261K | 514K |
| Change in Inventory | -590K | 58K | 994K | -8.76M | -2.09M | -299K | 441K |
| Change in Payables | -629K | -708K | -819K | -2.33M | 1.54M | 244K | -320K |
| Cash from Investing | 6.28M | -24.58M | 6.88M | 64.68M | -109.05M | -4.89M | -950K |
| Capital Expenditures | -647K | -713K | -265K | -782K | -1.5M | -4.69M | -950K |
| CapEx % of Revenue | 9.15% | 13.59% | 3.4% | 12.72% | 10.28% | 92.37% | 10.78% |
| Acquisitions | -5.2M | -5.3M | 0 | 0 | -29.69M | -200K | 0 |
| Investments | - | - | - | - | - | - | - |
| Other Investing | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Cash from Financing | 31.87M | 39.25M | 23.8M | -82K | -7.52M | 230.44M | 42.3M |
| Debt Issued (Net) | -3.78M | -3.72M | -3K | -4K | -95K | 1.91M | 2.31M |
| Equity Issued (Net) | 29.1M | 43.01M | 19.92M | -78K | -8.11M | 228.81M | 39.99M |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | 0 | 0 | -105K | -78K | -8.11M | 0 | 0 |
| Other Financing | 6.55M | -50K | 3.88M | 0 | 683K | -284K | 0 |
| Net Change in Cash | 7.79M | -12.97M | 8.05M | -12.02M | -181.96M | 183.45M | 33.66M |
| Free Cash Flow | -31.01M | -28.35M | -22.89M | -77.4M | -66.89M | -46.79M | -17.83M |
| FCF Margin % | -438.32% | -540.41% | -294.01% | -1259.39% | -459.12% | -921.99% | -202.34% |
| FCF Growth % | -33.63% | -23.84% | 70.42% | -15.72% | -42.95% | -162.4% | - |
| FCF per Share | -0.69 | -0.67 | -0.85 | -3.02 | -2.73 | -2.48 | -1.03 |
| FCF Conversion (FCF/Net Income) | 1.22x | -2.75x | 0.31x | 0.66x | 0.42x | 0.52x | 0.81x |
| Interest Paid | 0 | 0 | 0 | 0 | 6K | 0 | 0 |
| Taxes Paid | 0 | 0 | 10K | 7K | 0 | 0 | 0 |
Liquidity and operational viability
According to the provided financial data, PDYN exhibits a chronic inability to convert net income into operating cash flow, with the OCF/NI ratio fluctuating wildly and frequently failing to align with reported earnings, most notably during the 2025Q1 period where the ratio plummeted to -0.33.
The extreme volatility in the OCF/NI ratio suggests that reported net income is heavily influenced by non-operating accounting adjustments rather than core operational performance. Investors should monitor this divergence closely, as it indicates that the company's reported profitability is not translating into the liquidity required to sustain its ongoing software-centric pivot.
As reported in financial statements, PDYN's free cash flow remains consistently negative, with the company burning through $10.3 million in 2026Q1 alone, reflecting a persistent inability to achieve self-sustaining operations despite the strategic transition toward a software-licensing model and away from hardware-intensive manufacturing.
The persistent negative FCF margins, which reached a low of -21.8% in 2023Q4, underscore the structural challenges the company faces in scaling its new AI-driven software platform. This trajectory suggests that the business model remains highly dependent on external capital to fund its R&D-heavy cost structure.
Based on reported figures, PDYN's working capital dynamics are characterized by erratic swings, including a $1.3 million inflow in 2025Q2 followed by a $1.1 million outflow in 2025Q4, which complicates the company's ability to manage its limited cash reserves effectively during this period of strategic transition.
These fluctuations in working capital suggest that the company's cash conversion cycle is highly sensitive to the timing of milestone-dependent government and industrial contracts. The lack of consistency in these flows may indicate underlying inefficiencies in accounts receivable management or inventory liquidation as the company pivots away from its legacy hardware business.
Analysis of the 10-quarter data reveals a significant cumulative gap between reported net income and operating cash flow, as the company's cash burn has consistently outpaced its accounting results, highlighting a structural reliance on external financing to bridge the gap between operational losses and actual cash requirements.
The persistent negative operating cash flow, even in periods where net income appears less severe, suggests that the company's core business is not generating sufficient internal funds to cover its operating expenses. This divergence warrants further investigation into whether the company's software-licensing model can ever achieve the scale necessary to offset its high fixed-cost base.
Quick answers to the most common questions about buying PDYN stock.
Palladyne AI Corp. (PDYN) generated $-27.6M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Palladyne AI Corp. (PDYN) reported negative free cash flow of $28.4M in 2025, indicating capital requirements exceeded cash from operations.
Palladyne AI Corp. (PDYN) spent $0.7M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.