Free cash flow has turned sharply negative, reaching a -46.3% margin in 2026Q1, reflecting an inability to internally fund operations amidst ongoing liquidity erosion.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 | Dec'08 | Dec'07 | Dec'06 | Dec'05 | Dec'04 | Dec'03 | Dec'02 | Dec'01 |
|---|
| Cash from Operations | 296K | 603K | 871K | 244K | -2.55M | -3.25M | -2.28M | -1.58M | -2.38M | -935.92K | -1.34M | -1.5M | -2.02M | -2.79M | -367.06K | -313.88K | -369.5K | -270K | -370K | -421.36K | -850.32K | -606.91K | -1.01M | -641.4K | -818.15K | -677.82K |
| Operating CF Margin % | - | 3.68% | 3.6% | 0.96% | -13.03% | -375.32% | -665.01% | -644.49% | -3173.86% | - | -3628.95% | -688.24% | -1621.23% | -88814.3% | -2155.5% | -3533.15% | -687.79% | -1350% | -616.67% | -139.44% | -690.73% | -290.17% | -935.5% | -1032.5% | -647.79% | -5742.77% |
| Operating CF Growth % | 2454.36% | -30.77% | 256.97% | 109.56% | 21.6% | -42.66% | -44.46% | 33.56% | -153.94% | 30.4% | 10.07% | 25.98% | 27.57% | -659.76% | -16.94% | 15.05% | -36.85% | 27.03% | 12.19% | 50.45% | -40.11% | 40.03% | -57.79% | 21.6% | -20.7% | - |
| Net Income | -5.01M | -4.91M | -3.82M | -3.39M | -14.4M | 3.61M | -5.9M | -2.51M | -2.93M | -3.39M | -1.65M | -2.3M | -7.92M | -16.39M | -1.2M | -665.11K | -721.84K | -690K | -930K | -965.16K | -1.61M | -1.27M | -1.41M | -1.11M | -1.2M | -1.05M |
| Depreciation & Amortization | 830K | 984K | 1.21M | 1.13M | 770K | 117K | 98K | 34K | 20.96K | 43.09K | 30.2K | 94.12K | 82.36K | 81.93K | 13.47K | 10.9K | 13.61K | 0 | 0 | 157.26K | 264.54K | 13.11K | 9.47K | 119.7K | 278.99K | 33.99K |
| Stock-Based Compensation | -261K | 86K | 255K | 200K | 145K | 1.63M | 590K | 138K | 323.12K | 139.81K | 2.11M | 1.35M | 860.24K | 8.62M | 390.17K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Deferred Taxes | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 245.53K | 1.3M | -1.38M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Non-Cash Items | 4.73M | 4.62M | 2.92M | 1.68M | 11.95M | -8.36M | 3.09M | 740K | 102.88K | 901.06K | 712.6K | 325.61K | 952.5K | 13.24M | 252.65K | -13.64K | 245.24K | 490K | 840K | 115.34K | 405.56K | 391.76K | 493.6K | 237.85K | 109K | 323.25K |
| Working Capital Changes | 9K | -185K | 304K | 620K | -1.02M | -258K | -156K | 16K | -136.74K | 69.72K | 253.83K | 386.83K | 4.86M | 275.44K | 565.88K | 353.97K | 93.49K | -70K | -280K | 271.2K | 86.61K | 255.04K | -108.65K | 108.17K | -10.38K | 17.24K |
| Change in Receivables | 488K | 2.18M | 819K | 1.2M | -3.35M | -354K | 50K | -51K | -30.37K | 0 | 0 | 68.67K | 3.57K | -100 | -3.47K | 0 | 0 | 0 | 0 | 0 | 0 | 6.16K | 0 | 0 | 0 | 0 |
| Change in Inventory | 16K | 17K | 0 | -57K | -29K | 2K | -24K | 12K | -41.98K | 17.09K | 11.59K | 68.67K | -63.09K | -14.29K | 15.16K | -11.45K | -4.66K | 0 | 10K | 14.5K | 15.6K | -38.4K | -20.42K | 0 | 0 | 0 |
| Change in Payables | -607K | -2.35M | -630K | -531K | 3.62M | 69K | -37K | 0 | -352.01M | 61.87M | 251.66K | 330.06K | 4.9M | 327.03K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 289.96K | 0 | 0 | 0 | 0 |
| Cash from Investing | -2.69M | -2.73M | -575K | -1.2M | -7.88M | -2.85M | -125K | -302K | -108.74K | -2.65K | 0 | -2.53K | 0 | -32.53K | -9.03K | -3.58K | -2.5K | 0 | -10K | -25.35K | -10.14K | -62.98K | -55.06K | -25.55K | -18.84K | -35K |
| Capital Expenditures | -360K | 0 | -7K | -35K | -276K | -258K | -22K | -228K | -108.74K | -2.65K | 0 | -2.53K | 0 | -32.53K | -9.03K | -3.58K | -2.5K | 0 | -10K | -20.35K | -15.14K | -3.22K | -23.08K | 0 | -9.45K | 0 |
| CapEx % of Revenue | 2.62% | 4.47% | 0.03% | 0.14% | 1.41% | 29.76% | 6.41% | 93.06% | 145.21% | - | - | 1.17% | - | 1035.89% | 53% | 40.26% | 4.65% | - | 16.67% | 6.74% | 12.3% | 1.54% | 21.34% | - | 7.48% | - |
| Acquisitions | 0 | 0 | -52K | -363K | -7.5M | -2.59M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | -2.33M | -2.73M | -516K | -797K | -140K | 0 | -103K | -74K | -108.74K | -2.65K | 0 | -100 | 0 | -21.95K | -6.67K | 0 | 0 | 0 | 0 | -5K | 5K | -59.76K | -31.98K | -25.55K | -9.4K | -35K |
| Cash from Financing | 202K | 3.66M | -616K | 634K | 4.42M | 7.59M | 10.09M | 461K | 3.47M | 1.61M | 1.36M | 1.44M | 798K | 1.11M | 3.32M | 293.7K | 424.5K | 300K | 370K | 445K | 855.81K | 0 | 933.48K | 1.35M | 690.6K | 325K |
| Debt Issued (Net) | 0 | -875K | -500K | 600K | 118K | -3K | 1.07M | 461K | 0 | 281K | 79K | 109.54K | 798K | -150K | 193.75K | -58.5K | 466.5K | -18K | 0 | 445K | 800K | 0 | 0 | 50K | 0 | 0 |
| Equity Issued (Net) | 254K | 4.6M | 3K | 70K | 4.24M | 7.72M | 9.02M | 0 | 1.15M | 0 | 1.3M | 0 | 0 | 1.24M | 1.06M | 382.2K | 0 | 334K | 373.5K | 0 | 55.81K | 0 | 958.48K | 1.35M | 690.6K | 325K |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -596.88M | -1.28M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | -221K | -221K | -18K | -10K | -291K | -725K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -17.8K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Financing | -52K | -67K | -119K | -36K | 68K | -131K | 0 | 0 | 2.31M | 598.21M | -17.5K | 1.33M | 0 | 27.92K | 2.06M | -30K | -42K | -16K | -3.5K | 0 | 0 | 0 | -25K | -49.73K | 0 | 0 |
| Net Change in Cash | -2.19M | 1.53M | -272K | -316K | -6.01M | 1.48M | 7.69M | -1.42M | 980.2K | 670.36K | 18.49K | -59.8K | -1.22M | -1.71M | 2.94M | -23.76K | 52.51K | 30K | -10K | -1.71K | -4.65K | -669.89K | -133.67K | 687.67K | -146.39K | -387.82K |
| Free Cash Flow | -157K | -130K | 348K | -530K | -2.83M | -3.51M | -2.41M | -1.88M | -2.49M | -938.57K | -1.34M | -1.5M | -2.02M | -2.82M | -376.08K | -317.46K | -372K | -270K | -380K | -441.71K | -865.46K | -610.13K | -1.04M | -641.4K | -827.59K | -677.82K |
| FCF Margin % | -1.14% | -0.79% | 1.44% | -2.09% | -14.44% | -405.07% | -701.46% | -767.76% | -3319.07% | - | -3628.95% | -689.4% | -1621.23% | -89850.19% | -2208.5% | -3573.41% | -692.44% | -1350% | -633.33% | -146.17% | -703.03% | -291.71% | -956.84% | -1032.5% | -655.26% | -5742.77% |
| FCF Growth % | -273.81% | -137.36% | 165.66% | 81.25% | 19.5% | -45.97% | -27.91% | 24.32% | -164.81% | 30.2% | 10.22% | 25.85% | 28.4% | -650.18% | -18.47% | 14.66% | -37.78% | 28.95% | 13.97% | 48.96% | -41.85% | 41.06% | -61.39% | 22.5% | -22.1% | - |
| FCF per Share | -0.01 | -0.01 | 0.03 | -0.05 | -0.33 | -0.48 | -0.60 | -0.88 | -1.22 | -0.88 | -8.07 | -12.53 | -27.91 | -47.95 | -10.62 | -9.24 | -11.63 | -0.25 | -0.44 | -25.56 | -53.58 | -42.79 | -82.31 | -96.81 | -191.57 | -204.29 |
| FCF Conversion (FCF/Net Income) | 0.03x | -0.12x | -0.23x | -0.07x | 0.18x | -0.90x | 0.39x | 0.63x | 0.81x | 0.28x | 0.82x | 0.65x | 0.26x | 0.17x | 0.31x | 0.47x | 0.51x | 0.39x | 0.40x | 0.44x | 0.53x | 0.48x | 0.72x | 0.58x | 0.68x | 0.64x |
| Interest Paid | 0 | 70K | 0 | 165K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | 24K | 24K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Liquidity and revenue churn
According to recent financial filings, VerifyMe exhibits a persistent disconnect between net income and operating cash flow, with the OCF/NI ratio fluctuating wildly, including a 1.05 reading in 2026Q1, which suggests that reported losses are not being consistently mitigated by non-cash adjustments or working capital efficiency.
The extreme volatility in the OCF/NI ratio indicates that cash generation is highly sensitive to timing differences rather than core operational profitability. Investors should monitor this instability, as it suggests that the company's ability to generate cash is decoupled from its underlying earnings performance.
As reported in quarterly statements, VerifyMe's free cash flow trajectory has turned sharply negative, reaching a -46.3% FCF margin in 2026Q1, which underscores the company's inability to fund its operations internally while simultaneously managing the capital requirements of its integrated logistics and authentication business model.
The consistent failure to maintain positive FCF margins suggests that the business model is currently cash-consumptive rather than self-sustaining. This trend warrants further investigation into whether the company can achieve operational scale before its existing cash reserves are exhausted.
Based on the provided cash flow data, working capital changes have been a significant source of volatility, swinging from a $460.0K contribution in 2025Q2 to a $252.0K drain in 2026Q1, which highlights the company's struggle to manage receivables and payables effectively during a period of revenue contraction.
The erratic nature of these working capital swings may indicate inconsistent collection cycles or inventory management challenges. Such instability complicates cash flow forecasting and suggests that the company lacks the operational maturity to stabilize its short-term liquidity needs.
Financial disclosures reveal that VerifyMe has continued to allocate capital toward share repurchases, such as the $153.0K spent in 2025Q2, despite reporting persistent net losses and negative operating cash flow, a strategy that appears increasingly difficult to justify given the company's current liquidity constraints.
The decision to prioritize share buybacks while the core business is burning cash may indicate a misalignment between capital allocation and operational reality. Investors should monitor whether management will pivot toward preserving cash as the runway for the current business model continues to shorten.
Quick answers to the most common questions about buying VRME stock.
VerifyMe, Inc. (VRME) generated $0.6M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
VerifyMe, Inc. (VRME) reported negative free cash flow of $0.1M in 2025, indicating capital requirements exceeded cash from operations.
VerifyMe, Inc. (VRME) 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, VerifyMe, Inc. (VRME) spent $0.2M on share repurchases. This shows the company's commitment to returning capital to its equity investors.