Operating cash flow exceeded net income in every quarter (OCF/NI averaging 4.4x), with FCF swinging to $123M in Q2 2026 (13.1% margin), yet working capital swings and $1.1B in buybacks/dividends highlight timing and sustainability concerns.
PHINIA Inc. (PHIN) cash flow statement — 5-year operating, investing & financing cash flows
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 |
|---|
| Cash from Operations | 359M | 312M | 308M | 250M | 303M | 147M |
| Operating CF Margin % | - | 8.96% | 9.05% | 7.14% | 9.05% | 4.56% |
| Operating CF Growth % | 148.92% | 1.3% | 23.2% | -17.49% | 106.12% | - |
| Net Income | 135M | 130M | 79M | 102M | 262M | 153M |
| Depreciation & Amortization | 81M | 157M | 160M | 171M | 170M | 204M |
| Stock-Based Compensation | 3M | 18M | 14M | 10M | 11M | 11M |
| Deferred Taxes | -16M | -19M | 11M | 32M | 25M | -56M |
| Other Non-Cash Items | 153M | -6M | 38M | -7M | 8M | 63M |
| Working Capital Changes | 80M | 32M | 6M | -58M | -173M | -228M |
| Change in Receivables | 108M | 69M | 149M | 79M | -105M | 17M |
| Change in Inventory | 34M | 6M | 23M | -4M | -60M | -84M |
| Change in Payables | -49M | -26M | -114M | -95M | 16M | -96M |
| Cash from Investing | -117M | -132M | -101M | -150M | -105M | -140M |
| Capital Expenditures | -55M | -124M | -105M | -150M | -107M | -146M |
| CapEx % of Revenue | 1.52% | 3.56% | 3.09% | 4.29% | 3.2% | 4.52% |
| Acquisitions | -8M | -8M | 2M | 0 | 2M | 6M |
| Investments | - | - | - | - | - | - |
| Other Investing | -54M | 0 | 3M | 2M | 0 | 0 |
| Cash from Financing | -168M | -310M | -96M | 20M | -185M | -44M |
| Debt Issued (Net) | -35M | -55M | 178M | 68M | 22M | -52M |
| Equity Issued (Net) | -69M | -202M | -212M | -24M | 0 | 0 |
| Dividends Paid | -43M | -42M | -44M | -23M | 0 | 0 |
| Share Repurchases | -69M | -202M | -212M | -24M | 0 | 0 |
| Other Financing | -21M | -11M | -18M | -1M | -207M | 8M |
| Net Change in Cash | 77M | -125M | 119M | 114M | -8M | -33M |
| Free Cash Flow | 304M | 188M | 203M | 100M | 196M | 1M |
| FCF Margin % | 8.41% | 5.4% | 5.97% | 2.86% | 5.85% | 0.03% |
| FCF Growth % | 38.18% | -7.39% | 103% | -48.98% | 19500% | - |
| FCF per Share | 8.00 | 4.69 | 4.53 | 2.13 | 4.17 | 0.02 |
| FCF Conversion (FCF/Net Income) | 2.25x | 2.40x | 3.90x | 2.45x | 1.16x | 0.97x |
| Interest Paid | 32M | 59M | 34M | 26M | 13M | 14M |
| Taxes Paid | 38M | 61M | 94M | 88M | 51M | 38M |
Quick answers to the most common questions about buying PHIN stock.
PHINIA Inc. (PHIN) generated $312.0M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
PHINIA Inc. (PHIN) generated $188.0M 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.
PHINIA Inc. (PHIN) spent $124.0M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2025, PHINIA Inc. (PHIN) returned $42.0M to shareholders via cash dividends and spent $202.0M on share repurchases. This shows the company's commitment to returning capital to its equity investors.
Key Metrics
Top Statement Risk
Revenue growth sustainability and margin volatility
Metrics are mathematically derived from official filings.
Earnings Quality Boosted by Working Capital
PHIN's operating cash flow exceeded net income in every quarter, with OCF/NI averaging 4.4x over the last ten quarters, according to reported financials, suggesting strong cash conversion but partly driven by working capital swings.
The persistent OCF/NI ratio above 1.0, reaching as high as 14.6x in 2024Q4, indicates that reported earnings understate cash generation, likely due to significant non-cash D&A and favorable working capital changes. However, the volatility in working capital contributions, ranging from -$51M to +$60M, suggests that cash conversion is not purely operational but influenced by timing. Investors should monitor whether this gap narrows as growth normalizes.
Free Cash Flow Recovery After Weak Start
FCF swung from -$12M in 2024Q1 to $123M in 2026Q2, with FCF margin improving from -1.4% to 13.1%, as per financial statements, indicating a strong recovery but with quarterly volatility.
The FCF trajectory shows a clear upward trend, with 2026Q2 marking the highest FCF margin in the period, driven by robust operating cash flow and moderate capex. However, the path has been uneven, with 2025Q1 FCF margin at just 0.6%, reflecting the lumpy nature of working capital. This suggests that while the company is generating substantial cash, the sustainability of these margins depends on continued revenue growth and disciplined capex.
Capital Intensity Remains Moderate
CapEx as a percentage of revenue averaged 3.4% over the last ten quarters, with quarterly figures ranging from 2.0% to 5.0%, as reported in financial statements, indicating a capital-light model relative to peers.
PHIN's capital intensity is relatively low, with CapEx/Revenue consistently below 5%, suggesting that the company does not require heavy investment to maintain operations. This is consistent with its industrial parts focus, where D&A ($40M per quarter) exceeds CapEx in most quarters, implying that maintenance capex is adequately covered. The moderate capex supports strong FCF generation, but investors should watch for any increase in growth-oriented investments that could pressure cash flows.
Working Capital Swings Drive Cash Flow
Working capital changes contributed an average of $9M per quarter, but with wide swings from -$51M to +$60M, as per financial statements, indicating that cash flow is significantly influenced by timing of receivables, inventory, and payables.
The working capital line is the most volatile component of operating cash flow, with positive contributions in six of ten quarters. This suggests that PHIN may be managing its supply chain effectively, but the large negative quarters (e.g., -$51M in 2024Q1) highlight potential strain during periods of growth. The recent positive contributions in 2025Q4 and 2026Q2 may indicate improved collection or inventory management, but the pattern warrants close monitoring as it can distort underlying cash generation.
Shareholder Returns Outpace Acquisitions
PHIN returned $1.1B to shareholders via buybacks and dividends over the last ten quarters, while acquisitions totaled just $3M, as per reported cash flow data, indicating a clear preference for direct capital returns.
The company has consistently repurchased shares, with buybacks ranging from $23M to $100M per quarter, and paid a steady dividend of around $10-12M quarterly. This aggressive buyback program, especially the $100M in 2025Q1, suggests management confidence in the stock's value, but it also reduces cash reserves. With minimal acquisition activity, the capital deployment strategy appears focused on returning cash to shareholders rather than inorganic growth, which may limit future expansion opportunities.
Cumulative Cash Exceeds Reported Earnings
Over the last ten quarters, cumulative operating cash flow of $764M surpassed cumulative net income of $286M by $478M, as per financial statements, indicating that earnings significantly understate cash generation.
The cumulative gap between operating cash flow and net income is substantial, driven by non-cash D&A and favorable working capital changes. This divergence suggests that PHIN's earnings quality is high, as cash flows are robust, but it also raises questions about the sustainability of such a large gap. If working capital tailwinds reverse, the gap could narrow, potentially impacting future cash flow. Investors should assess whether this pattern reflects genuine operational efficiency or one-time benefits.
What Could Invalidate the Base Case
Despite strong cash generation, PHIN's cash flow may be overstated by working capital timing and buyback-driven cash outflows, as per reported data, warranting scrutiny of sustainability.
The cash flow statement obscures the extent to which working capital swings, rather than core operations, drive the OCF/NI gap. Additionally, the heavy reliance on buybacks, with $100M in 2025Q1, could mask underlying cash needs if growth requires reinvestment. The negative SBC adjustments in 2026Q2 and zero R&D in 2026, as per prior income statement analysis, may indicate that reported cash flows are not fully indicative of long-term competitive positioning. Investors should monitor whether cash conversion remains robust without these tailwinds.