Longtime free cash flow burner Netflix (NFLX) is now showing investors a different story.
Netflix generated a whopping $2.1 billion in free cash flow in the first quarter, which flew somewhat under the radar in its latest earnings release late Tuesday.
Free cash flow is operating cash flow minus capital expenditures. A company essentially hits the free cash flow mark by being profitable and investing those profits prudently into “stuff” like plants and equipment. The cash left over could then be used to further bolster the total return potential for investors by way of stock buybacks or dividend increases.
Netflix has long shown negative reads — or outflows — on the free cash flow line, in part reflecting aggressive investments into its business and a focus on low prices (which produced losses).
In this photo illustration, the American global streaming media provider Netflix logo is seen on an Android mobile device screen with the currency of the United States dollar. (Photo…
This article was written by and originally published on finance.yahoo.com