Free cash flow margins have deteriorated sharply, contracting from 29.6% in 2024Q3 to a negative 2.3% in 2025Q4, reflecting a reduced ability to convert revenue into sustainable cash.
| Metric | Mar'26 | Mar'25 | Mar'24 | Mar'23 | Mar'22 | Mar'21 | Mar'20 | Mar'19 | Mar'18 | Mar'17 | Mar'16 | Mar'15 | Mar'14 | Mar'13 | Mar'12 | Mar'11 | Mar'10 | Mar'09 | Mar'08 | Mar'07 | Mar'06 | Mar'05 | Mar'04 | Mar'03 | Mar'02 | Mar'01 |
|---|
| Cash from Operations | 995.32B | 1.06T | 716.34B | 977.16B | 1.12T | 1.01T | 669.75B | 328.48B | 377.85B | 261.36B | 25.49B | 182.52B | 148.34B | 307.71B | 336.57B | 326.94B | 381.17B | 326.27B | 292.5B | 209.28B | 373.57B | 295.54B | 311.12B | 263.45B | 240.59B | 212.66B |
| Operating CF Margin % | 20.83% | 23.07% | 16.8% | 24.26% | 31.47% | 31.61% | 20.35% | 15.66% | 21.34% | 15.09% | 1.41% | 10.27% | 8.77% | 19.76% | 22.31% | 23.03% | 26% | 21.21% | 21.28% | 16.03% | 30.82% | 26.32% | 28.64% | 25.18% | 23.94% | 22.07% |
| Operating CF Growth % | -5.85% | 47.58% | -26.69% | -13% | 11.1% | 50.94% | 103.89% | -13.07% | 44.57% | 925.31% | -86.03% | 23.04% | -51.79% | -8.58% | 2.95% | -14.23% | 16.82% | 11.55% | 39.76% | -43.98% | 26.4% | -5.01% | 18.1% | 9.5% | 13.13% | - |
| Net Income | 203.33B | 107.93B | 144.07B | 317.04B | 230.17B | 376.17B | 44.29B | 109.01B | 186.71B | 115.51B | 83.48B | -143.03B | 109.56B | 129.71B | 252.48B | 371.57B | 415.83B | 398.55B | 576.84B | 625.38B | 517.96B | 441.1B | 446.14B | 431.9B | 235.66B | 263.08B |
| Depreciation & Amortization | 764.62B | 761.4B | 728B | 664.4B | 583.15B | 559.67B | 583.65B | 272.45B | 182.13B | 222.79B | 197.38B | 260.95B | 215.74B | 201.11B | 150.19B | 106.72B | 114.83B | 118.08B | 31.69B | 28.82B | 28.73B | 31.23B | 28.08B | 29.96B | 28.43B | 33.6B |
| Stock-Based Compensation | 0 | 72.87B | 70.87B | 60.67B | 43.37B | 37.66B | 29.12B | 20.08B | 18.61B | 17.41B | 14.71B | 20.35B | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Deferred Taxes | 0 | 0 | -91.41B | 58.05B | 72.41B | -9.94B | -105.04B | -14.12B | 30.5B | 27.83B | 37.06B | -2.4B | 49.29B | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Non-Cash Items | 292.37B | 167.25B | 120.81B | -97.74B | 95.4B | -228.42B | 23.06B | -134.89B | -53.49B | 25.49B | 22.1B | -80.02B | 44.64B | -35.43B | -130.83B | -142.2B | -163.63B | -153.44B | -307.33B | -409.06B | -163.1B | -148.18B | -146.84B | -205.13B | -27.75B | -48.98B |
| Working Capital Changes | -264.99B | -52.25B | -256B | -25.26B | 98.61B | 275.78B | 94.67B | 75.95B | 13.4B | 29.68B | -267.21B | 262.33B | -57.12B | 12.33B | 64.72B | -9.16B | 14.15B | -36.92B | -8.71B | -35.86B | -10.01B | -28.61B | -16.26B | 6.72B | 4.25B | -35.04B |
| Change in Receivables | -74.4B | -58.96B | 15.1B | 75.13B | 127.29B | -9.32B | -34.83B | -13.38B | -647M | -37.31B | 12.37B | -32.52B | -42.5B | 16.59B | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Change in Inventory | -64.99B | -34.97B | -115.74B | -79.16B | -46.15B | 25.98B | 137.49B | 58.68B | 13.72B | 3.89B | -6.84B | -14.55B | -16.92B | -14.92B | 49.31B | -557M | -7.37B | -11B | -14.51B | -7.05B | -5.65B | -3.4B | -3.97B | -5.17B | -1.61B | -1.75B |
| Change in Payables | -3.34B | 0 | -9.89B | -53.13B | 75.55B | 210.02B | -29.93B | -16.41B | 6.86B | 42.56B | 17.91B | -7.08B | -42.33B | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Cash from Investing | -411.19B | -367.06B | -463.86B | -607.1B | -198.13B | 393.53B | 292.12B | -2.84T | -93.34B | -655.69B | -71.21B | 91.35B | -158.61B | -111.38B | -1.09T | -99.25B | -117.52B | -767.26B | 101.75B | 116.39B | 6.57B | -72.31B | -139.32B | 140.15B | 125.24B | -58.25B |
| Capital Expenditures | -435.72B | -200.79B | -175.42B | -633.69B | -186.04B | -236.47B | -217.71B | -134.11B | -128.26B | -112.03B | -84.86B | -108.72B | -78.52B | -95.76B | -61.9B | -124.17B | -86.96B | -39.46B | -32.62B | -29.15B | -32.09B | -53.67B | -54.16B | -33.48B | -37.52B | -26.94B |
| CapEx % of Revenue | 9.12% | 4.38% | 4.11% | 15.73% | 5.21% | 7.39% | 6.61% | 6.39% | 7.24% | 6.47% | 4.7% | 6.12% | 4.64% | 6.15% | 4.1% | 8.75% | 5.93% | 2.57% | 2.37% | 2.23% | 2.65% | 4.78% | 4.99% | 3.2% | 3.73% | 2.8% |
| Acquisitions | 42.18B | 0 | -4.74B | 7.96B | -21.48B | 530.39B | 456.66B | -2.87T | 56.75B | -524.74B | -7.05B | -20.43B | -3.34B | -80.82B | -1.04T | 690M | 753M | 559M | -1.76B | 15.08B | 10.77B | -29.09B | 3.09B | 60.41B | 58.91B | 16.54B |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -8.52B | -166.26B | -251.66B | 6.53B | 808M | 37.6B | 11.32B | 124.03B | 26.08B | -12.09B | 4.26B | 58.71B | 12.67B | 6.91B | 8.04B | 3.89B | -20.59B | 22.2B | 23.23B | -55.49B | 493M | 5.88B | 19.86B | 28.37B | -89.32B | -39.58B |
| Cash from Financing | -398.08B | -751.42B | -354.42B | -709.15B | -1.07T | -1.09T | -1.01T | 2.95T | -326.23B | 289.9B | -124.84B | -301B | 101.44B | -150.56B | 393.79B | -146.54B | -148.05B | -425.84B | -262.08B | -315.94B | -89.29B | -73.91B | -59.34B | -58.99B | -52.66B | -41.91B |
| Debt Issued (Net) | 46.49B | -314.31B | 1.51B | -285.07B | -600.48B | -511.46B | -586.09B | 3.16T | -153.14B | 471.42B | 45.92B | -119.5B | 248.9B | -4.86B | 539.3B | -663M | -1.14B | -170M | -2.19B | -1.89B | -2.25B | 2.7B | 2.52B | -2.05B | -1.99B | -4.94B |
| Equity Issued (Net) | -54.72B | -51.86B | -2.33B | -26.93B | -77.53B | -2.14B | -3.74B | -1.17B | -18.76B | -23.12B | -22.35B | -17.59B | 0 | -24M | -16M | -50M | -34M | -280.27B | -128.76B | -213.73B | -156M | -166M | 0 | 0 | 0 | 0 |
| Dividends Paid | -330.71B | -302.5B | -287.19B | -279.42B | -283.67B | -283.36B | -282.58B | -142.95B | -141.89B | -141.69B | -141.54B | -141.64B | -142.13B | -142.12B | -142.01B | -142.06B | -143.55B | -142.45B | -129.17B | -98.76B | -85.53B | -74.96B | -60.87B | -54.44B | -48.54B | -36.61B |
| Share Repurchases | -54.72B | -51.86B | -2.33B | -26.93B | -77.53B | -2.14B | -3.74B | -1.17B | -18.76B | -23.12B | -22.35B | -17.59B | -37M | -24M | -16M | -50M | -34M | -280.27B | -128.76B | -213.73B | -156M | -166M | 0 | 0 | 0 | 0 |
| Other Financing | -59.15B | -82.75B | -66.42B | -117.73B | -108.59B | -291.39B | -132.8B | -71.14B | -12.44B | -16.72B | -6.88B | -22.27B | -5.32B | -5.2B | -3.48B | -3.78B | -3.32B | -2.96B | -1.97B | -1.56B | -1.35B | -1.49B | -999M | -2.51B | -2.12B | -363M |
| Net Change in Cash | 347.89B | -72.69B | -75.73B | -316.17B | -116.53B | 328.61B | -65.11B | 407.12B | -46.73B | -131.97B | -203.82B | -10.8B | 120.47B | 91.33B | -418.46B | 20.23B | 94.4B | -855.16B | -34.45B | 21.46B | 361.91B | 188.24B | 53.13B | 324.64B | 336.64B | 119.76B |
| Free Cash Flow | 808.7B | 856.39B | 235.61B | 343.47B | 937.07B | 774.46B | 452.04B | 194.37B | 249.59B | 149.34B | -59.37B | 73.8B | 69.82B | 211.95B | 274.67B | 202.77B | 294.21B | 286.81B | 259.88B | 180.13B | 341.48B | 241.87B | 256.96B | 229.97B | 203.06B | 185.72B |
| FCF Margin % | 16.93% | 18.69% | 5.53% | 8.53% | 26.26% | 24.22% | 13.73% | 9.27% | 14.1% | 8.62% | -3.28% | 4.15% | 4.13% | 13.61% | 18.2% | 14.29% | 20.07% | 18.64% | 18.9% | 13.8% | 28.17% | 21.54% | 23.65% | 21.98% | 20.2% | 19.28% |
| FCF Growth % | -5.57% | 263.47% | -31.4% | -63.35% | 21% | 71.33% | 132.57% | -22.13% | 67.13% | 351.55% | -180.44% | 5.71% | -67.06% | -22.84% | 35.45% | -31.08% | 2.58% | 10.36% | 44.27% | -47.25% | 41.18% | -5.87% | 11.74% | 13.25% | 9.34% | - |
| FCF per Share | 252.28 | 266.73 | 74.55 | 109.39 | 297.07 | 246.09 | 144.31 | 100.51 | 158.63 | 95.01 | -37.66 | 46.92 | 44.17 | 134.21 | 173.94 | 128.41 | 186.33 | 177.31 | 153.16 | 103.53 | 192.88 | 136.61 | 81.91 | 73.31 | 64.73 | 59.20 |
| FCF Conversion (FCF/Net Income) | 4.90x | 9.80x | 4.97x | 3.08x | 4.88x | 2.69x | 15.14x | 3.01x | 2.02x | 2.27x | 0.32x | -1.25x | 1.39x | 2.34x | 2.71x | 1.32x | 1.28x | 1.39x | 0.82x | 0.62x | 1.19x | 1.07x | 1.09x | 0.97x | 1.02x | 1.45x |
| Interest Paid | 0 | 112.98B | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Persistent operating cash volatility
As reported in recent financial statements, Takeda's operating cash flow to net income ratio has exhibited extreme instability, reaching a negative 0.79 in 2025Q4, which suggests that reported accounting profits are frequently decoupled from the actual cash-generating capacity of the underlying pharmaceutical business segments.
The significant divergence between net income and operating cash flow indicates that non-cash charges and working capital swings are heavily distorting the firm's earnings quality. Investors should monitor this disconnect, as it implies that the company's reported profitability may not be a reliable proxy for its ability to fund operations or service debt.
Based on the provided quarterly data, Takeda's free cash flow margin has experienced sharp contraction, falling from a peak of 29.6% in 2024Q3 to a negative 2.3% in 2025Q4, signaling a deteriorating ability to convert revenue into sustainable cash for shareholders.
The erratic nature of free cash flow generation appears to be driven by both inconsistent operating performance and high capital intensity. This trend warrants further investigation, as it suggests that the company's current cost structure may be struggling to adapt to the loss of exclusivity for key legacy products.
According to recent SEC filings, Takeda's capital expenditure as a percentage of revenue has remained elevated, peaking at 19.0% in 2025Q3, which reflects the substantial ongoing investment required to maintain its complex plasma-derived therapy infrastructure and global manufacturing network.
The high level of capital intensity suggests that Takeda is locked into a cycle of heavy reinvestment to defend its competitive moat in the plasma space. While necessary for long-term viability, this spending profile limits the firm's financial flexibility during periods of revenue stagnation.
As evidenced by the quarterly cash flow statements, Takeda has faced significant working capital volatility, including a massive $224.5 billion outflow in 2025Q4, which indicates potential inefficiencies in inventory management or the timing of collections across its diverse global operations.
These large, erratic swings in working capital appear to be a primary driver of the company's inconsistent cash flow performance. The lack of predictability in these cycles suggests that management may be struggling to optimize its cash conversion cycle in the face of shifting market demands.
Based on reported figures, Takeda's capital deployment has shifted toward aggressive dividend payments and debt management, with $155.4 billion in dividends paid in 2025Q3, even as operating cash flow remains highly sensitive to the company's ongoing pipeline and patent-related headwinds.
The commitment to returning capital to shareholders appears to be occurring despite the firm's strained cash flow trajectory and the need for deleveraging. This strategy may be unsustainable if the company cannot stabilize its core operating cash generation in the coming quarters.
Quick answers to the most common questions about buying TAK stock.
Takeda Pharmaceutical Company Limited (TAK) generated $995.32B in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Takeda Pharmaceutical Company Limited (TAK) generated $808.70B 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.
Takeda Pharmaceutical Company Limited (TAK) spent $435.72B 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, Takeda Pharmaceutical Company Limited (TAK) returned $330.71B to shareholders via cash dividends and spent $54.72B on share repurchases. This shows the company's commitment to returning capital to its equity investors.