Persistent free cash flow deficits, which reached a margin of -317.7% in 2023Q2, highlight a structural reliance on external capital to fund ongoing research and development.
| Cash from Operations | -6.6M | -7.61M | -8.43M | -5.71M | -2.1M | -1.09M | -481K |
| Operating CF Margin % | -1019.78% | -1458.43% | -10285.37% | -12697.78% | -1480.99% | -1910.53% | -198.76% |
| Operating CF Growth % | 13.33% | 9.73% | -47.6% | -171.71% | -93.11% | -126.4% | - |
| Net Income | -8.11M | -7.88M | -7.81M | -6.5M | -2.61M | -1.26M | -977K |
| Depreciation & Amortization | 84K | 107K | 68K | 23K | 11K | 7K | 7K |
| Stock-Based Compensation | 1.09M | 182K | 241K | 790K | 299K | 67K | 148K |
| Deferred Taxes | 0 | 0 | 0 | -731K | -291K | -196K | 0 |
| Other Non-Cash Items | 51K | 244K | -113K | 731K | 311K | 252K | 50K |
| Working Capital Changes | 283K | -267K | -816K | -31K | 181K | 39K | 291K |
| Change in Receivables | -20K | 448K | -54K | 16K | -19K | -62K | 90K |
| Change in Inventory | 247K | -269K | -1.03M | 5K | 9K | -12K | 13K |
| Change in Payables | -95K | -253K | 254K | 84K | 40K | -41K | 47K |
| Cash from Investing | -10.93M | 3.2M | -4.25M | -66K | -36K | -16K | -1K |
| Capital Expenditures | -20K | -43K | -194K | -48K | -36K | -16K | -1K |
| CapEx % of Revenue | 3.09% | 8.24% | 236.59% | 106.67% | 25.35% | 28.07% | 0.41% |
| Acquisitions | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Investments | - | - | - | - | - | - | - |
| Other Investing | 0 | 3.24M | 0 | -18K | 0 | 0 | 0 |
| Cash from Financing | 20.94M | 6.7M | 3.12M | 14.88M | 2.94M | 0 | 1.9M |
| Debt Issued (Net) | -770K | 764K | 0 | 0 | 0 | 0 | 1.9M |
| Equity Issued (Net) | 21.71M | 5.93M | 1.67M | 14.72M | 2.93M | 0 | 0 |
| Dividends Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Share Repurchases | 0 | 0 | 0 | -100K | 0 | 0 | 0 |
| Other Financing | 0 | 0 | 1.45M | 160K | 12K | 0 | 0 |
| Net Change in Cash | 3.41M | 2.28M | -9.56M | 9.1M | 799K | -1.1M | 1.42M |
| Free Cash Flow | -6.62M | -7.66M | -8.63M | -5.76M | -2.14M | -1.1M | -482K |
| FCF Margin % | -1022.87% | -1466.67% | -10521.95% | -12804.44% | -1506.34% | -1938.6% | -199.17% |
| FCF Growth % | 13.56% | 11.27% | -49.74% | -169.38% | -93.57% | -129.25% | - |
| FCF per Share | -66.15 | -2031.85 | -3682.46 | -2647.98 | -1328.57 | -686.34 | -299.38 |
| FCF Conversion (FCF/Net Income) | 0.81x | 0.97x | 1.08x | 0.88x | 0.80x | 0.87x | 0.49x |
| Interest Paid | 0 | 49K | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Liquidity and capital exhaustion
Based on reported financial statements, WLDS exhibits a persistent disconnect between net income and operating cash flow, with OCF/NI ratios fluctuating between 0.70 and 1.20, suggesting that non-cash charges and working capital volatility significantly distort the company's underlying ability to generate cash from its core operations.
The variability in the OCF/NI ratio indicates that the company's reported losses are not perfectly aligned with cash outflows, likely due to the timing of inventory payments and stock-based compensation. Investors should monitor whether this conversion gap narrows as the company attempts to scale its hardware sales, as current figures suggest a lack of operational cash efficiency.
As reported in quarterly filings, WLDS has consistently burned cash, with FCF margins reaching as low as -317.7% in 2023Q2, illustrating a structural inability to fund operations through product sales and highlighting a heavy reliance on external financing to sustain its ongoing research and development activities.
The trajectory of free cash flow remains deeply negative, showing no clear path to self-sustainment under the current cost structure. This trend suggests that the company is effectively trading equity for time, with each quarter of negative FCF further depleting the limited cash reserves available for future product development.
According to historical cash flow data, working capital changes have been highly erratic, swinging from a $861,000 outflow in 2023Q4 to a $305,000 inflow in 2024Q2, which indicates significant instability in the company's ability to manage its inventory and payables cycle effectively during its nascent growth phase.
This volatility in working capital suggests that the company's cash position is highly sensitive to the timing of hardware production runs and supplier payment terms. Such fluctuations may indicate that the company lacks the scale to negotiate favorable terms, forcing it to absorb cash shocks that further strain its limited liquidity.
Based on an analysis of cash flow statements, stock-based compensation has been a recurring non-cash adjustment, peaking at $427,000 in 2025Q2, which effectively obscures the true economic cost of talent acquisition and dilutes existing shareholders without providing any immediate relief to the company's cash burn.
While SBC is a standard practice for early-stage tech firms, its consistent presence in the cash flow reconciliation suggests that the company is relying on equity to preserve cash. Analysts should consider the long-term impact of this dilution, as it represents a significant cost that is not captured in the headline operating cash flow figures.
Quick answers to the most common questions about buying WLDS stock.
Wearable Devices Ltd. (WLDS) generated $-6.6M in net cash from operating activities in 2025. This reflects the cash generated directly from core business operations.
Wearable Devices Ltd. (WLDS) reported negative free cash flow of $6.6M in 2025, indicating capital requirements exceeded cash from operations.
Wearable Devices Ltd. (WLDS) 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.