Vishay Intertechnology, Inc. (VSH) Cash Flow Statement

The conversion ratio has been elevated across the last two quarters, with OCF at 2.99 times net income in 2026Q2 and 8.89 times in 2026Q1, which may indicate that non-cash charges and working capital releases are inflating operating cash relative to accounting profit. Given that trailing net margin remains at -0.3%, investors should monitor whether this cash conversion reflects durable operating improvement or timing effects that could reverse as the restocking cycle normalizes.

The swing in FCF margin from -5.6% to 10.0% over two quarters is significant, but the trajectory is still anchored to a short window of positive results after an extended period of negative FCF through 2024 and 2025. The 2026Q3 figure benefited from a relatively modest CapEx load of 4.9% of revenue, and sustaining this margin will depend on whether capital intensity stays contained as management pursues the Vishay 3.0 initiatives.

CapEx ran at 20.3% of revenue in 2024Q4 and 11.8% in 2025Q4, indicating that the company has historically been capital-intensive and that the recent low readings may be cyclical rather than structural. Because the Vishay 3.0 strategy signals a pivot toward expanded capacity, investors should watch whether CapEx re-accelerates, since higher spending would compress near-term free cash flow even as it supports long-term volume.

The steady dividend outflow equals a substantial share of FCF in weaker quarters, such as 2025Q3 and 2026Q1, which suggests the payout has been maintained through the downturn rather than adjusted to earnings. Limited buyback activity and near-zero acquisition spending indicate that surplus cash from the recovery is likely being retained or redirected toward capacity investment, a choice that warrants further investigation as the balance sheet strengthens.