Investing term

What is Cash from operations (CFO)?

Cash actually generated by running the business — the most truthful number on the cash flow statement.

Cash from operations (CFO) is the cash a company actually generates by running its core business, before investing or financing activity. Many analysts treat it as the most trustworthy line in the financial statements, because it strips out accounting estimates and shows whether the day-to-day business truly produces cash. Profit can be massaged; sustained operating cash is much harder to fake.

For example

A company reporting strong profits but weak cash from operations may be booking sales it can't collect — the CFO line exposes the gap.

Cash from operations (CFO) is taught hands-on in Stage 14 — Reading Financial Statements.

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Related terms

Accounts receivable (A/R)Money customers owe the company for goods or services already delivered but not yet paid.AccrualsAccounting entries that record revenue or expense before cash actually moves.Annual reportThe yearly disclosure that includes audited financials, MD&A, and footnotes — the primary source for serious investors.Balance sheetThe 'photo' statement — what the company owns, what it owes, and what's left for owners, on a single date.
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