Will a profitable company have a positive cash flow?

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1028442

2026-03-28 07:06

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Not necessarily. A profitable company can report positive net income while experiencing negative cash flow due to factors like high accounts receivable, significant capital expenditures, or inventory buildup. Profitability reflects earnings on an accrual basis, while cash flow focuses on actual cash movements. Therefore, it's possible for a company to be profitable yet struggle with cash flow challenges.

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