Free Cash Flow explained

What is Free Cash Flow (FCF) and how do I calculate it? What is Free Cash Flow used for? What is the mearning of Free Cash Flow? What is the Free Cash Flow performance of Exxon Mobil, Facebook, General Electric and General Motors ? This Finance Storyteller video provides an in depth look at common and alternative definitions of Free Cash Flow (FCF), compares the profit view and the cash flow view of looking at a company’s performance, and analyzes the Free Cash Flow numbers published by Exxon Mobil, Facebook, General Electric and General Motors. ⏱️TIMESTAMPS⏱️ 00:00 Introduction to Free Cash Flow 00:56 Free Cash Flow in the financial statements 01:25 Free Cash Flow definition 02:05 Free Cash Flow calculation 03:54 Free Cash Flow example 05:06 Profit vs Free Cash Flow 07:04 Free Cash Flow comparison between companies 10:25 Free Cash Flow and valuation 11:46 Free Cash Flow summary Free Cash Flow is usually defined as: Cash flow not required for operations or reinvestment Cash flow available for distribution among all the securities holders (debt or equity) of an organization Calculation: Cash From Operating Activities (CFOA) minus Capital Expenditures Unfortunately, the Free Cash Flow definitions that companies use are not always the same. Some stay very close to what you see here, but we will also see some alternative definitions along the way in this video. Related videos: Free Cash Flow case study: Netflix    • Free cash flow case study: Netflix   Cash Flow Statement explained    • Cash Flow Statement explained   GAAP versus non-GAAP    • GAAP vs non-GAAP   From revenue to profit to free cash flow in a business plan    • Business plan financials: revenue, profit,...   Cash From Investing Activities    • Cash from investing activities   Philip de Vroe (The Finance Storyteller) aims to make strategy, finance and leadership enjoyable and easier to understand. Learn the business vocabulary to join the conversation with your CEO at your company. Understand how financial statements work in order to make better stock market investment decisions. Philip delivers training in various formats: YouTube videos, classroom sessions, webinars, and business simulations. Connect with me through Linked In!