TTM Cash From Operations
TTM cash from operations is the net cash a company's day-to-day business generated over the trailing twelve months, the four most recent fiscal quarters. It is the operating section of the cash flow statement rolled into a current, full-year total.
It starts from net income, adds back noncash charges such as depreciation and stock-based compensation, and adjusts for changes in working capital like receivables, inventory, and payables. The result is the cash the business actually produced, as opposed to the profit it reported.
The quarterly input is tagged NetCashProvidedByUsedInOperatingActivities in XBRL. Under ASC 230, operating activities are everything not classified as investing or financing, so the line picks up cash received from customers and cash paid to suppliers, employees, and tax authorities, as well as interest paid. The XBRL element includes discontinued operations.
10-Q cash flow statements are cumulative from the start of the fiscal year, so the TTM total is calculated as the latest annual figure plus the current year-to-date figure, minus the matching year-to-date figure from the prior year. On a quarter-by-quarter basis, the fourth quarter is the 10-K annual amount minus the nine-month amount in the third-quarter 10-Q. Cash flows are usually more seasonal than earnings, so a single quarter can be a poor guide, and the rolling year smooths that out.
TTM operating cash flow is the base of GeminIQ's TTM free cash flow calculation, which subtracts TTM capital expenditures, and of cash flow per share. Analysts compare it with TTM net income to judge earnings quality: operating cash flow that consistently trails net income can point to aggressive revenue recognition or a buildup of receivables and inventory. It is also the basis for cash-based coverage ratios that set cash generation against debt and liabilities.
A: Net income includes noncash items like depreciation and records revenue when earned, not when collected. Changes in working capital, such as customers paying late or inventory building up, shift cash between periods without changing profit.
A: Add the current year-to-date figure from the latest 10-Q to the last fiscal year's total from the 10-K, then subtract the year-to-date figure for the same period a year earlier.
A: Yes. Under US GAAP interest paid is an operating cash outflow, which is why measures of cash flow to the firm add it back.
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