What Is Cash Flow From Investing Activities?

Cash flow from investing activities (CFI) is one section of a company's cash flow statement. It reports how much cash has been generated or spent from investment-related activities in a specific period.

Investing activities include purchases of physical assets, investments in securities, or the sale of securities or as🤡sets. Investmentไ may generate income or ensure the long-term health or performance of the company.

Cash Flow Statements

There are three main financial statements that a business uses: the balance sheet, income statement, and cash flow statement. The 澳洲幸运5开奖号码历史查询:balance sheet provides an overview of a company's assets, liabilities, and owners' equity as of a specific date. The 澳洲幸运5开奖号码历史查询:income statement provides an overviewꦜ of the company's revenues and expenses duri﷽ng a period.

The cash flow statement bridges the gap between the income statement and the balance sheet by showing how much cash is generated or spent on operati♐ng, investing, and financing activities for a specific period.

The cash flow statement provides an account of the cash used in operations, including 澳洲幸运5开奖号码历史查询:working capital, financing, and investing. There are three sections on the cash flow statement: cash flow from investing ꦰactivities, cash flow from operating activities, and cash flow from financing ac🍸tivities.

Investing Activities

Cash flows from investing activities provide an account of cash used in the purchase of non-current assets, also known as long-term assets, that will deliver v🎉al♍ue in the future. 

Investing activity is an important aspect of growth and capital. A change to 澳洲幸运5开奖号🐭码历史查询:property, plant, and equipment (PPE), a large line item on the balance sheet, is considered an investing activit🦂y. When investors and analysts want to know how much a company spends on PPE, they can ไlook for the sources and uses of funds in the investing section of the cash flow statement.

Capital expenditures (CapEx) are also found in this section. This item is a popular measure of capital investꦍment used in the valuation of stocks. An increase in capital expenditures means the company is investing in future operations. However, capital expenditures are a reduction in cash flow. Typically, companies with significant capital expendit💟ures are in a state of growth.

Operating Activities and Financing Activities

Besides cash flow from investing, the two additional cash flow activities are operational and financial. 澳洲幸运5开奖号码历史查询:Operating activities include any inflow or♐ outfloℱw that is part of a company's daily operations. Any cash spent or generated from the company's products or services is listed in this section. This may include cash from the sale of goods, interest payments, employee salaries, inventory payments, or income tax payments.

Cash generated or spent on 澳洲幸运5开奖号码历史查询:financing activities shows the net cash flows involved in funding the company's operations. Financing activities include dividend payments, 澳洲幸运5开奖号码历史查询:stock repurchases, or bond offerings that generate cash.

Example

Below is the cash flow statement from Apple Inc. according to the company's 10-Q report issued on Nov. 2, 2023. The three sꦅections of Apple's statement of cash flows ar💛e listed with operating activities at the top and financing activities at the bottom of the statement. In the center are the investing activities.

Investing activไities that were cash-flow negative include:

• Purchases of marketable securities for $29.52 billion
• Payments for the acquisition of property, plant, and equipment for $10.96 billion
• Other for $1.34 billion

Investing activities that were cash flow positive include:ꦆ

• Proceeds from maturities of 澳洲幸运5开奖号码历史查询:marketable securities for $39.69 billion
• Proceeds from the sale of marketable securities for $5.83 billion

The net cash flows generated from investing activities were $3.71 billion for the twelve months ending Sept. 30, 2023. Overall, Apple had a positive cash flow from investing activity despite spending nearly $30 billion on the purchase of marketable securities.

The Bottom Line

The cash flow sta😼tement is one of the three financial reports that a company generates in an accounting period. One of the sections of the cash flow statement is cash flow from investing activities. These can either be positive or negative. Negative cash flow may signal that the company is investing in assets or other long-term development activities important to the health and continued operations of the company.