Cash flow generation is hindered by high capital intensity, with capital expenditures reaching 8.7% of revenue in 2025Q2 and an OCF/NI ratio of -1.87 in 2025Q3, indicating a decoupling of earnings from cash.
| Cash from Operations | 125.64M | 89.68M | 46.99M | 11.86M | -127.42M | -38.23M | -2.28M | 44.38M |
| Operating CF Margin % | - | 7.45% | 4.14% | 1.22% | -22.73% | -9.95% | -0.36% | 7.71% |
| Operating CF Growth % | 391.2% | 90.85% | 296.09% | 109.31% | -233.3% | -1577.45% | -105.14% | - |
| Net Income | -77.34M | -163.57M | -117.09M | -223.36M | -268.71M | -228.46M | -127.74M | -91.36M |
| Depreciation & Amortization | 98.93M | 101.52M | 111.4M | 99.92M | 83.61M | 69.8M | 57.14M | 48.39M |
| Stock-Based Compensation | 7.79M | 14.66M | 18.88M | 26.21M | 26.66M | 2.62M | 0 | 0 |
| Deferred Taxes | -10.9M | -3.83M | -607K | 237K | -273K | 0 | 0 | 0 |
| Other Non-Cash Items | 60.79M | 93.54M | 60.15M | 109.12M | -17.32M | 37.26M | 39.04M | 118.48M |
| Working Capital Changes | 45.96M | 47.34M | -25.75M | -258K | 48.62M | 80.55M | 29.28M | 61.32M |
| Change in Receivables | -6.36M | -21.27M | -14.23M | -24.28M | -5.86M | 10.58M | -18.53M | 9.47M |
| Change in Inventory | -324K | 2.55M | -9.75M | -29.61M | -7.56M | 6.97M | -8.75M | -5.15M |
| Change in Payables | -52.39M | 26.78M | 4.53M | 0 | 27.19M | 0 | 0 | 0 |
| Cash from Investing | -115.72M | -71.24M | -82.36M | -92.75M | -119.14M | -139.87M | -210.78M | -135.32M |
| Capital Expenditures | -83.77M | -64.19M | -67.76M | -72.34M | -103.08M | -139.44M | -161.7M | -137.01M |
| CapEx % of Revenue | 6.5% | 5.33% | 5.97% | 7.41% | 18.39% | 36.28% | 25.19% | 23.79% |
| Acquisitions | -2M | 10.7M | 0 | 0 | -8.24M | 1.14M | -48.88M | 1.32M |
| Investments | - | - | - | - | - | - | - | - |
| Other Investing | -29.95M | -17.75M | -14.6M | -20.41M | 0 | 0 | 0 | 0 |
| Cash from Financing | -9.54M | -19.91M | 4.91M | 52.84M | 408.16M | 179.7M | 196.96M | 111.51M |
| Debt Issued (Net) | -8.17M | -1.05M | 21.8M | 106.17M | -145.64M | 58.33M | 120.42M | 98.64M |
| Equity Issued (Net) | 1000K | -1000K | -1000K | -1000K | 1000K | 1000K | 1000K | 0 |
| Dividends Paid | 0 | 0 | 0 | 0 | -19.9M | 0 | -364K | -1.27M |
| Share Repurchases | 17.4M | -17.4M | -12M | -50.27M | 0 | 0 | -15M | 0 |
| Other Financing | -18.77M | -1.45M | -4.9M | -3.07M | -22.42M | 26.47M | 9.73M | 14.14M |
| Net Change in Cash | 1.63M | -4.79M | -27.5M | -32.05M | 160.69M | 3.65M | -15.14M | 20.57M |
| Free Cash Flow | 25.53M | 7.75M | -36.89M | -82.15M | -230.5M | -177.67M | -150.23M | -92.63M |
| FCF Margin % | 1.98% | 0.64% | -3.25% | -8.42% | -41.12% | -46.22% | -23.4% | -16.08% |
| FCF Growth % | 988.55% | 120.99% | 55.1% | 64.36% | -29.74% | -18.26% | -62.19% | - |
| FCF per Share | 0.13 | 0.04 | -0.19 | -0.41 | -1.33 | -0.88 | -0.73 | -0.45 |
| FCF Conversion (FCF/Net Income) | -0.33x | -0.55x | -0.40x | -0.05x | 0.48x | 0.17x | 0.02x | -0.49x |
| Interest Paid | 34.49M | 34.38M | 32.25M | 29.89M | 130.26M | 28.54M | 0 | 37.17M |
| Taxes Paid | 3.5M | 3.77M | 5.54M | 585K | 310K | 1.7M | 0 | 317K |
Persistent negative free cash
According to reported financial data, the persistent gap between net income and operating cash flow, highlighted by an OCF/NI ratio of -1.87 in 2025Q3, suggests that reported earnings are significantly decoupled from the actual cash-generating capacity of the underlying membership-based hospitality operations.
The frequent divergence between accounting losses and positive operating cash flow indicates a heavy reliance on non-cash adjustments, such as depreciation and amortization, to mask operational volatility. Investors should monitor whether this disconnect reflects aggressive capitalization policies or simply the inherent mismatch between membership revenue recognition and cash collection cycles.
As reported in recent quarterly filings, Soho House & Co Inc. has struggled to maintain consistent positive free cash flow, with margins fluctuating between -6.9% and 4.3% over the last ten quarters, indicating that the business model remains highly sensitive to capital expenditure requirements.
The inability to generate sustained free cash flow suggests that the company's expansion strategy is currently consuming more capital than the mature houses can provide. This trajectory warrants further investigation into whether the firm can reach a self-funding state without continued reliance on external financing or equity dilution.
Based on the provided cash flow statements, capital expenditures have consistently represented a significant portion of revenue, peaking at 8.7% in 2025Q2, which underscores the high maintenance and growth costs required to sustain the brand's physical footprint and aesthetic standards.
The high ratio of CapEx to revenue suggests that the company is trapped in a cycle of continuous reinvestment to prevent brand degradation. This capital intensity appears to be a structural drag on cash flow, limiting the firm's ability to pivot toward a more capital-light model.
As evidenced by the erratic working capital changes, which swung from a $27.4M inflow in 2025Q2 to a $1.7M outflow in 2025Q1, the company's cash flow is subject to significant quarterly swings that complicate short-term liquidity management and operational forecasting.
These fluctuations may indicate inconsistent efficiency in managing accounts payable and membership fee collections across different geographic markets. Analysts should monitor whether these swings are seasonal or indicative of deeper challenges in managing the cash conversion cycle within the hospitality segment.
Quick answers to the most common questions about buying SHCO stock.
Soho House & Co Inc. (SHCO) generated $89.7M in net cash from operating activities in 2024. This reflects the cash generated directly from core business operations.
Soho House & Co Inc. (SHCO) generated $7.7M 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.
Soho House & Co Inc. (SHCO) spent $64.2M 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, Soho House & Co Inc. (SHCO) spent $17.4M on share repurchases. This shows the company's commitment to returning capital to its equity investors.