Cash flow definition

A - B - C - D - E - F - G - H - I - L - M - N - O - P - Q - R - S - T - U - V - W - Y

See all glossary trading terms

Cash flow is the amount of money coming into and going out of a company’s accounts, as reported in earnings announcements. It can refer to a single project or the entire business.

Some traders use cash flow as a means of judging a business’s financial foundations. If there is a large amount of cash coming in, there is more available to reinvest in the business. Cash flow can be easier to compare between companies as it isn’t subject to accounting rules.

Cash flow isn’t necessarily a sign that a company is profitable, but does indicate its liquidity. Total cash flow is calculated by deducting the total costs and adding incomes over a period of time, to give the change in cash balance. There are many other types of cash flow, though, depending on which aspect of a business’s cash flow is being calculated.

Visit our market data section

Find some companies' cash flow totals in our market data section.

Contact us

Our helpdesk is open 24 hours a day from 9am Sunday to 11pm Friday.