Free cash flow remains highly intermittent, swinging from a 22.1% margin in 2025Q4 to a -12.7% margin in 2026Q1, largely driven by volatile working capital changes.
| Cash from Operations | 43.65M | 37.01M | 21.55M | -61.27M | -91.56M | -142.15M | -134.42M | -54.49M | -47.2M | -38.57M |
| Operating CF Margin % | - | 5.34% | 3.59% | -11.15% | -15.17% | -30.39% | -44.81% | -17.22% | -22.76% | -28.05% |
| Operating CF Growth % | 204.2% | 71.76% | 135.17% | 33.08% | 35.59% | -5.75% | -146.69% | -15.46% | -22.35% | - |
| Net Income | -65.26M | -41.8M | -134.2M | -168.47M | -196.44M | -236.11M | -175.83M | -96.75M | -75.77M | -52.31M |
| Depreciation & Amortization | 36.7M | 33M | 48.29M | 34.27M | 30.04M | 23.53M | 18.84M | 13.41M | 9.29M | 5.63M |
| Stock-Based Compensation | 19.65M | 28.94M | 0 | 34.27M | 46.14M | 48.8M | 24.32M | 8.53M | 3.76M | 1.85M |
| Deferred Taxes | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 3.15M | 2.98M | 933K |
| Other Non-Cash Items | 55.77M | 26.13M | 104.62M | 67.29M | 31.01M | 36.48M | 19.77M | 105K | 445K | 70K |
| Working Capital Changes | -3.2M | -9.26M | 2.84M | -28.63M | -2.29M | -14.86M | -21.53M | 17.06M | 12.1M | 5.24M |
| Change in Receivables | 197K | -12.47M | 767K | -6.98M | -6.12M | -1.59M | -337K | -1.58M | -1.57M | -4.21M |
| Change in Inventory | -10.08M | -9.47M | -3.68M | 10.94M | 23.97M | -29.2M | -20.41M | -13.24M | -3.74M | -3.91M |
| Change in Payables | 957K | 1.61M | 910K | 0 | 0 | -9.99M | 2.8M | 6.01M | -2.58M | -88K |
| Cash from Investing | -34.01M | -29.22M | -25.59M | -42.13M | -36.92M | -43.44M | 178M | -215.36M | -33.92M | -11.3M |
| Capital Expenditures | -25.02M | -18.64M | -26.05M | -29.18M | -22.86M | -37.47M | -18.25M | -34.03M | -19.12M | -14.12M |
| CapEx % of Revenue | 3.46% | 2.69% | 4.34% | 5.31% | 3.79% | 8.01% | 6.09% | 10.76% | 9.22% | 10.27% |
| Acquisitions | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 9.27M | 5.72M | 2.52M |
| Investments | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -8.98M | -10.58M | 461K | -12.95M | -14.06M | -9.97M | -8.68M | -9.27M | -5.72M | -2.52M |
| Cash from Financing | -25.35M | -28.87M | 539K | 226K | 4.1M | 252.91M | 152.81M | 378.67M | 106.08M | 46.72M |
| Debt Issued (Net) | -26.75M | -26.75M | 0 | 0 | 0 | 278.23M | 166.28M | -9.25M | 9.77M | -1.25M |
| Equity Issued (Net) | 2.54M | 2.68M | 1.79M | -679K | -205K | 0 | 0 | 385.32M | 96.27M | 47.76M |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | 0 | 0 | 0 | -679K | -205K | 0 | 0 | 0 | 0 | 0 |
| Other Financing | -1.14M | -4.8M | -1.25M | 905K | 4.31M | -25.32M | -13.46M | 2.6M | 45K | 212K |
| Net Change in Cash | -15.7M | -21.08M | -3.5M | -103.17M | -124.38M | 67.33M | 196.4M | 108.82M | 24.97M | -3.16M |
| Free Cash Flow | 12.59M | 18.37M | -4.5M | -90.44M | -114.42M | -189.59M | -161.35M | -88.52M | -66.31M | -52.69M |
| FCF Margin % | 1.74% | 2.65% | -0.75% | -16.47% | -18.96% | -40.54% | -53.79% | -27.98% | -31.98% | -38.32% |
| FCF Growth % | 164.24% | 508.13% | 95.02% | 20.95% | 39.65% | -17.5% | -82.28% | -33.49% | -25.84% | - |
| FCF per Share | 0.04 | 0.06 | -0.04 | -0.89 | -1.19 | -2.07 | -1.84 | -1.03 | -1.06 | -0.84 |
| FCF Conversion (FCF/Net Income) | -0.19x | -0.89x | -0.16x | 0.36x | 0.47x | 0.60x | 0.76x | 0.55x | 0.62x | 0.74x |
| Interest Paid | 10.49M | 0 | 0 | 8.13M | 8.1M | 6.58M | 11K | 553K | 666K | 704K |
| Taxes Paid | -4K | 0 | 0 | 0 | 0 | 94K | 90K | 102K | 49K | 22K |
High Operating Leverage Sensitivity
As reported in recent financial filings, the relationship between net income and operating cash flow for The RealReal remains deeply inconsistent, evidenced by a 2026Q1 OCF/NI ratio of -0.43, which suggests that reported GAAP profits are frequently decoupled from the company's actual ability to generate cash.
The significant divergence between net income and operating cash flow indicates that non-cash items and accruals are heavily influencing the bottom line. Investors should monitor whether this disconnect persists, as it complicates the assessment of the company's underlying operational health and its true progress toward self-sustaining cash generation.
Based on the provided cash flow data, The RealReal's free cash flow trajectory is characterized by sharp quarterly swings, with a peak margin of 22.1% in 2025Q4 followed by a contraction to -12.7% in 2026Q1, highlighting the company's ongoing struggle to achieve consistent positive cash flow.
The volatility in free cash flow suggests that the business model remains highly sensitive to seasonal shifts and inventory management cycles. This inconsistency implies that the company has not yet reached a stage of operational maturity where cash generation is predictable or decoupled from aggressive growth-related spending.
According to the quarterly cash flow statements, working capital changes are a primary driver of cash flow variability, with a notable $25.4 million outflow in 2026Q1 contrasting with a $22.3 million inflow in 2025Q4, indicating significant friction in the company's cash conversion cycle.
These fluctuations suggest that the timing of consignor payouts and inventory intake creates substantial pressure on liquidity. The reliance on working capital shifts to bridge cash flow gaps warrants further investigation into the efficiency of the company's logistics and payment processing infrastructure.
As indicated by the reported figures, The RealReal maintains a moderate capital intensity, with CapEx/Revenue ratios fluctuating between 1.4% and 6.9% over the last ten quarters, reflecting the ongoing necessity of investing in physical authentication infrastructure to support its high-touch luxury resale business model.
The persistent capital expenditure suggests that the company's moat is tied to physical assets that require constant maintenance and potential upgrades. This capital intensity may continue to act as a drag on free cash flow until the company can achieve greater scale or successfully automate its authentication processes.
Quick answers to the most common questions about buying REAL stock.
The RealReal, Inc. (REAL) generated $37.0M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
The RealReal, Inc. (REAL) generated $18.4M 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.
The RealReal, Inc. (REAL) spent $18.6M on capital expenditures in 2025. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.