Free cash flow remains resilient with margins between 1.4% and 10.7%, supported by minimal capital intensity as evidenced by a CapEx/Revenue ratio consistently below 2.0%.
| Cash from Operations | 232.94M | 282.72M | 235.62M | 272.64M | 79.42M |
| Operating CF Margin % | - | 7.45% | 7.65% | 9.51% | 4.51% |
| Operating CF Growth % | 665.65% | 19.99% | -13.58% | 243.26% | - |
| Net Income | -171.43M | 385.53M | -108.65M | -233.43M | -316.04M |
| Depreciation & Amortization | 8.74M | 5.01M | 3.71M | 10.6M | 7.42M |
| Stock-Based Compensation | 119.23M | 27.76M | 191.63M | 291.43M | 101.83M |
| Deferred Taxes | 0 | 12.86M | -2.08M | -1.45M | 0 |
| Other Non-Cash Items | 66.86M | -8.45M | -7.2M | -3.56M | -1.96M |
| Working Capital Changes | 237.61M | -139.99M | 158.21M | 209.05M | 288.17M |
| Change in Receivables | 39.24M | -4.38M | -10.27M | 55.35M | -98.89M |
| Change in Inventory | 0 | -6.34M | 36.71M | 0 | -46.38M |
| Change in Payables | 26.6M | -28K | 16.92M | 2.63M | 62.14M |
| Cash from Investing | 64.7M | -132.78M | 201K | -108.58M | -62.35M |
| Capital Expenditures | -3.48M | -3.64M | -5.76M | -4.56M | -35.63M |
| CapEx % of Revenue | 0.12% | 0.1% | 0.19% | 0.16% | 2.02% |
| Acquisitions | 2M | -2M | 2M | 14.13M | -29.8M |
| Investments | - | - | - | - | - |
| Other Investing | 17.44M | 16.01M | 31.58M | -15.15M | 32.08M |
| Cash from Financing | -38.4M | -130.19M | 247.7M | 71.63M | -21.09M |
| Debt Issued (Net) | 0 | 0 | 0 | -23.35M | 15.95M |
| Equity Issued (Net) | 0 | -1000K | 1000K | 0 | 0 |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | 0 | -130.41M | 0 | 0 | 0 |
| Other Financing | -38.4M | 217K | 2.25M | 94.98M | -37.04M |
| Net Change in Cash | 364.9M | 15.81M | 497.85M | 241.33M | -4.02M |
| Free Cash Flow | 229.46M | 279.08M | 229.87M | 268.08M | 43.8M |
| FCF Margin % | 7.76% | 7.35% | 7.46% | 9.35% | 2.49% |
| FCF Growth % | 106.94% | 21.41% | -14.25% | 512.06% | - |
| FCF per Share | 3.92 | 4.92 | 6.63 | 4.87 | 0.80 |
| FCF Conversion (FCF/Net Income) | -1.34x | 0.73x | -2.17x | -1.17x | -0.25x |
| Interest Paid | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | 4.58M | 6.86M | 22.27M | 14.76M | 0 |
High customer acquisition costs
As reported in financial statements, QuantaSing's operating cash flow frequently decouples from net income, with the OCF/NI ratio exhibiting extreme volatility, such as the 597.89x figure in 2022Q3, which suggests that reported earnings are currently an unreliable proxy for the company's actual cash-generating capacity.
The significant divergence between net income and operating cash flow indicates that non-cash items and working capital adjustments are the primary drivers of reported results. Investors should monitor this gap closely, as it suggests that the company's profitability is highly sensitive to accounting treatments rather than pure operational efficiency.
Based on recent SEC filings, QuantaSing has maintained a positive free cash flow trajectory despite erratic net income performance, with FCF margins hovering between 1.4% and 10.7% over the last eight quarters, indicating that cash generation is more resilient than the bottom-line accounting figures suggest.
The ability to generate positive free cash flow while reporting periodic net losses implies that the business model is fundamentally cash-generative at the operating level. However, the reliance on deferred revenue to support this cash flow warrants further investigation into the sustainability of these upfront payments.
According to the provided cash flow data, working capital changes have consistently provided a significant boost to operating cash flow, with quarterly inflows reaching as high as $126.1 million, which appears to be driven by the aggressive collection of upfront course fees from the student base.
This reliance on working capital inflows suggests that the company's cash position is heavily dependent on maintaining a high velocity of new student enrollments. Should the pace of new sign-ups decelerate, the company may face a sudden contraction in operating cash flow as the deferred revenue tailwind dissipates.
As evidenced by the company's financial disclosures, QuantaSing maintains a remarkably low capital intensity, with CapEx/Revenue ratios consistently remaining below 2.0%, which allows the firm to preserve the majority of its operating cash flow for marketing and other variable growth-related expenditures.
The minimal investment in physical assets reflects the digital-first nature of the education platform, which avoids the heavy maintenance costs associated with traditional infrastructure. While this low intensity supports liquidity, it also suggests that the company's competitive moat is not built on proprietary hardware or physical facilities.
Quick answers to the most common questions about buying QSG stock.
QuantaSing Group Ltd (QSG) generated $282.7M in net cash from operating activities in 2024. This reflects the cash generated directly from core business operations.
QuantaSing Group Ltd (QSG) generated $279.1M in free cash flow in 2024. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
QuantaSing Group Ltd (QSG) spent $3.6M on capital expenditures in 2024. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2024, QuantaSing Group Ltd (QSG) spent $130.4M on share repurchases. This shows the company's commitment to returning capital to its equity investors.