Free cash flow has deteriorated to a -70.2% margin in 2026Q1, reflecting an inability to retain cash from a shrinking revenue base.
System1, Inc. (SST) cash flow statement — 7-year operating, investing & financing cash flows
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 |
|---|
| Cash from Operations | -66.99M | -4.15M | -5.25M | -24.74M | -7.29M | 60.7M | 46.55M | 32.71M |
| Operating CF Margin % | - | -1.56% | -1.53% | -6.16% | -1.1% | 8.82% | - | 8.03% |
| Operating CF Growth % | -42696.85% | 21.08% | 78.76% | -239.58% | -112% | 30.42% | 42.29% | - |
| Net Income | -91.67M | -81.19M | -97.3M | -174.33M | 33M | 33M | 16.36M | 24.25M |
| Depreciation & Amortization | 72.9M | 82.86M | 80.11M | 105.21M | 70.47M | 13.88M | 13.83M | 11.24M |
| Stock-Based Compensation | 10.07M | 11.31M | 15.76M | 53.09M | 79.22M | 413K | 1.19M | 1.76M |
| Deferred Taxes | -2.11M | -2.19M | -2.1M | -22.33M | -118.86M | -981K | 32K | -2.14M |
| Other Non-Cash Items | 65.16M | 4.03M | 1.2M | 18.78M | -25.77M | 9.31M | 3.61M | 7.35M |
| Working Capital Changes | -53.22M | -18.97M | -2.92M | -5.16M | -45.33M | 5.08M | 11.52M | -9.75M |
| Change in Receivables | 32.57M | 4.93M | -6.8M | 20.86M | 15.72M | -19.06M | 6.83M | -10.95M |
| Change in Inventory | 0 | 0 | 0 | 0 | 0 | 0 | 34K | -2.37M |
| Change in Payables | -20.64M | 12.01M | 903K | -6.8M | -65.48M | 20.76M | 4.23M | 3.74M |
| Cash from Investing | -9.33M | -6.72M | -6.25M | 203.18M | -454.45M | -6.54M | 68.17M | -42.76M |
| Capital Expenditures | -9.26M | -46K | -31K | -2.35M | -10.38M | -49K | -6.13M | -6.7M |
| CapEx % of Revenue | 5.12% | 0.02% | 0.01% | 0.59% | 1.56% | 0.01% | - | 1.64% |
| Acquisitions | 0 | 0 | 0 | 211.14M | -444.07M | 0 | 74.54M | -35.94M |
| Investments | - | - | - | - | - | - | - | - |
| Other Investing | -68K | -6.68M | -6.22M | -5.61M | 0 | -6.49M | -247K | -120K |
| Cash from Financing | 16.42M | 31.3M | -63.96M | -74.07M | -27.73M | -34.59M | -128.07M | 26.15M |
| Debt Issued (Net) | 17.5M | 30M | -61.79M | -68.98M | 262.51M | -13.14M | -78.28M | 28.62M |
| Equity Issued (Net) | -772K | 1.69M | -2.15M | -3.06M | -506.56M | 227K | 518.75M | 0 |
| Dividends Paid | 1K | -32K | -27K | -97K | -1.51M | -14.58M | -46.55M | -8.65M |
| Share Repurchases | -772K | -557K | -2.15M | -3.06M | -511.59M | 0 | -518.75M | 0 |
| Other Financing | -310K | -356K | 0 | -1.94M | 217.83M | -7.1M | -521.99M | 6.18M |
| Net Change in Cash | -60.02M | 20.56M | -75.5M | 104.38M | -33.27M | 19.63M | -13.81M | 15.95M |
| Free Cash Flow | -77.76M | -4.19M | -5.29M | -32.7M | -17.66M | 54.17M | 40.42M | 26.02M |
| FCF Margin % | -42.98% | -1.58% | -1.54% | -8.14% | -2.66% | 7.87% | - | 6.38% |
| FCF Growth % | -2556.03% | 20.68% | 83.84% | -85.15% | -132.6% | 34.03% | 55.35% | - |
| FCF per Share | -9.52 | -0.53 | -0.08 | -0.36 | -0.19 | 0.64 | 0.62 | 0.29 |
| FCF Conversion (FCF/Net Income) | 0.85x | 0.06x | 0.07x | 0.11x | 0.02x | 1.84x | -1.56x | 3.72x |
| Interest Paid | 12.58M | 0 | 0 | 42.88M | 0 | 14.74M | 22.23M | 21.44M |
| Taxes Paid | 91K | 0 | 0 | 7.1M | 0 | 2.75M | 4.4M | 55K |
Quick answers to the most common questions about buying SST stock.
System1, Inc. (SST) generated $-4.1M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
System1, Inc. (SST) reported negative free cash flow of $4.2M in 2025, indicating capital requirements exceeded cash from operations.
System1, Inc. (SST) spent $0.0M 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, System1, Inc. (SST) returned $0.0M to shareholders via cash dividends and spent $0.6M on share repurchases. This shows the company's commitment to returning capital to its equity investors.
Key Metrics
Top Statement Risk
Arbitrage spread compression
Metrics are mathematically derived from official filings.
Earnings Quality and Cash Disconnect
According to the provided cash flow data, System1 exhibits a persistent disconnect between net losses and operating cash flow, with the OCF/NI ratio fluctuating wildly from 0.56 in 2026Q1 to 1.52 in 2024Q1, suggesting that accounting accruals and non-cash charges significantly distort the company's true cash-generating capacity.
The frequent divergence between net income and operating cash flow indicates that the company's reported losses are heavily influenced by non-cash items, likely depreciation and amortization related to past acquisitions. Investors should monitor whether the company can ever bridge this gap, as the current reliance on non-cash adjustments to mask operational cash burn appears unsustainable.
Free Cash Flow Margin Erosion
As reported in recent financial statements, System1's free cash flow trajectory has deteriorated significantly, culminating in a -70.2% FCF margin in 2026Q1, which underscores the company's inability to retain cash from its shrinking revenue base while maintaining its core digital infrastructure and platform requirements.
The consistent negative FCF margins suggest that the business model is currently incapable of self-funding its operations without external capital or existing cash reserves. This trend warrants further investigation into whether the company's RAMP platform can achieve the necessary scale to turn cash flow positive, or if the current burn rate is a structural feature of its high-TAC environment.
Working Capital Volatility and Pressure
Based on historical quarterly filings, System1 has experienced extreme volatility in working capital, with a $19.5 million outflow in 2026Q1 following a $19.0 million inflow in 2025Q2, indicating that the company's cash conversion cycle is highly sensitive to the timing of traffic acquisition payments and partner revenue collections.
This erratic working capital behavior suggests that the company lacks a stable cash conversion cycle, likely due to the transactional nature of its ad-tech business. Such instability complicates liquidity planning and may force the company to maintain higher cash balances than would otherwise be necessary to buffer against these periodic liquidity swings.
Obscured Cash Flow Realities
Data from recent disclosures indicates that System1's cash flow statement is heavily impacted by stock-based compensation and significant non-cash D&A, which, as noted in financial filings, often masks the underlying cash burn required to sustain the RAMP platform's competitive position in a crowded digital advertising market.
The persistent use of stock-based compensation as a primary adjustment to cash flow suggests that the company is effectively diluting shareholders to fund operational expenses that are not being covered by core business activities. Analysts should be wary of these adjustments, as they may obscure the true economic cost of maintaining the company's proprietary technology and intent-matching capabilities.