Regeneron Pharmaceuticals Inc. (NASDAQ:REGN)

The company demonstrates generally positive operating cash flow throughout the observed period, though with fluctuations. Net income exhibits volatility, beginning at US$8.075 billion in 2021, decreasing to US$3.954 billion in 2023, and showing a modest recovery to US$4.505 billion by 2025. Significant investment activity, particularly in marketable securities, consistently results in substantial cash outflows from investing activities. Financing activities consistently show net cash outflows, primarily driven by common stock repurchases, which increase in magnitude over time. Overall, the company maintains a healthy cash balance, with a net increase in cash, cash equivalents, and restricted cash in most years.

Operating Activities

Net cash provided by operating activities remains consistently positive, ranging from US$4.421 billion to US$7.081 billion. While net income fluctuates, adjustments to reconcile net income to net cash provided by operating activities show variability, with a notable negative adjustment of US$994 million in 2021, shifting to positive adjustments in subsequent years, peaking at US$676.5 million in 2022. Changes in working capital components demonstrate dynamic shifts. Accounts receivable generally decrease, contributing positively to cash flow, except for 2024 and 2025 where increases are observed. Inventory levels consistently decrease, also contributing positively to cash flow. Accounts payable and accrued expenses generally increase, providing a cash inflow, with a notable decrease in 2022.

Investing Activities

Investing activities are characterized by substantial outflows related to the purchase of marketable securities, which increase significantly from US$7.048 billion in 2021 to US$16.617 billion in 2024 before decreasing to US$10.958 billion in 2025. Sales or maturities of marketable securities provide offsetting inflows, also increasing over time, peaking at US$15.027 billion in 2024. Capital expenditures remain relatively stable, ranging from US$552 million to US$898 million annually. Payments for intangible assets are present in 2022, 2023, and 2024, decreasing each year. Acquisitions also contribute to net cash used in investing activities, though the amounts are smaller and decreasing.

Financing Activities

Financing activities consistently utilize cash. Proceeds from the issuance of common stock provide inflows, but these are offset by payments related to employee tax obligations and, more significantly, by substantial repurchases of common stock. Stock repurchases increase from US$1.645 billion in 2021 to US$3.439 billion in 2025. The introduction of dividend payments in 2025 represents a new cash outflow of US$370.3 million. Overall, net cash used in financing activities increases from US$1.006 billion in 2021 to US$3.715 billion in 2025.

Cash Position

The company begins the period with US$2.207 billion in cash, cash equivalents, and restricted cash. Despite significant investing and financing outflows, the cash balance generally increases, reaching US$3.124 billion by the end of 2025, with a decrease observed in 2023 and 2024. The effect of exchange rate changes on cash is minimal.

The company’s cash flow patterns suggest a strategy of generating strong operating cash flow, reinvesting in marketable securities, returning capital to shareholders through stock repurchases and, beginning in 2025, dividends, and maintaining a healthy cash reserve.