Cash Flow Statement

The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.

The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.

Vertex Pharmaceuticals Inc., consolidated cash flow statement

US$ in thousands

12 months ended:	Dec 31, 2025	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021
Net income (loss)	3,953,200)	(535,600)	3,619,600)	3,322,000)	2,342,100)
Stock-based compensation expense	685,900)	698,500)	581,200)	491,300)	441,400)
Depreciation and amortization expense	209,800)	207,200)	181,300)	148,300)	125,600)
Intangible asset impairment charges	379,000)	—)	—)	—)	—)
Deferred income taxes	(510,800)	(348,800)	(536,500)	(275,900)	(154,600)
Other non-cash items, net	113,400)	900)	(42,600)	103,400)	(5,800)
Accounts receivable, net	(347,300)	(99,300)	(84,100)	(358,600)	(274,700)
Inventories	(524,200)	(517,300)	(322,900)	(136,400)	(92,800)
Prepaid expenses and other assets	(396,000)	(200,300)	(545,700)	(326,400)	(91,800)
Accounts payable	36,800)	49,500)	48,700)	120,800)	31,900)
Accrued expenses	(116,900)	212,900)	429,400)	542,500)	305,400)
Other liabilities	148,500)	39,700)	208,900)	498,900)	16,800)
Changes in operating assets and liabilities	(1,199,100)	(514,800)	(265,700)	340,800)	(105,200)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities	(321,800)	43,000)	(82,300)	807,900)	301,400)
Net cash provided by (used in) operating activities	3,631,400)	(492,600)	3,537,300)	4,129,900)	2,643,500)
Purchases of available-for-sale debt securities	(6,396,500)	(7,438,200)	(3,786,500)	(692,700)	(528,200)
Sales and maturities of available-for-sale debt securities	5,897,400)	4,465,600)	839,100)	920,000)	499,300)
Purchases of property and equipment	(437,600)	(297,700)	(200,400)	(204,700)	(235,000)
Proceeds related to equity securities	16,000)	—)	95,100)	—)	—)
Net payments related to finite-lived intangible assets	—)	(187,700)	(58,000)	—)	—)
Acquisition of available-for-sale debt securities from Alpine Immune Sciences, Inc.	—)	(258,000)	—)	—)	—)
Payment to acquire ViaCyte, Inc., net of cash acquired	—)	—)	—)	(295,900)	—)
Other investing activities	(24,700)	(54,000)	(31,000)	(47,800)	(77,000)
Net cash used in investing activities	(945,400)	(3,770,000)	(3,141,700)	(321,100)	(340,900)
Issuances of common stock under benefit plans	127,700)	114,600)	134,600)	186,300)	102,000)
Repurchases of common stock	(2,017,400)	(1,177,100)	(427,600)	—)	(1,425,400)
Payments in connection with common stock withheld for employee tax obligations	(369,900)	(405,000)	(226,100)	(172,000)	(135,900)
Payments on finance leases	(5,400)	(33,600)	(44,900)	(85,500)	(47,000)
Proceeds from finance leases	—)	—)	—)	—)	22,600)
Other financing activities	3,700)	6,200)	1,800)	3,500)	5,700)
Net cash used in financing activities	(2,261,300)	(1,494,900)	(562,200)	(67,700)	(1,478,000)
Effect of changes in exchange rates on cash	90,900)	(42,600)	26,900)	(29,200)	(13,400)
Net increase (decrease) in cash, cash equivalents and restricted cash	515,600)	(5,800,100)	(139,700)	3,711,900)	811,200)
Cash, cash equivalents and restricted cash, beginning of period	4,572,200)	10,372,300)	10,512,000)	6,800,100)	5,988,900)
Cash, cash equivalents and restricted cash, end of period	5,087,800)	4,572,200)	10,372,300)	10,512,000)	6,800,100)

Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).

The financial statement information reveals significant fluctuations in cash flow patterns over the five-year period. Operating activities generally provide positive cash flow, though with considerable variation. Investing activities consistently represent a cash outflow, primarily driven by purchases of available-for-sale debt securities. Financing activities demonstrate a net cash outflow in most years, largely attributable to common stock repurchases.

Operating Activities: Net cash provided by operating activities increased from US$2,643,500 thousand in 2021 to US$4,129,900 thousand in 2022, and then to US$3,537,300 thousand in 2023. A substantial decrease occurred in 2024, resulting in a net cash *use* of US$492,600 thousand, before recovering to US$3,631,400 thousand in 2025. This volatility is linked to changes in net income, accounts receivable, inventories, and accrued expenses. The adjustments to reconcile net income to net cash flow from operations also show considerable fluctuation, particularly in 2024 and 2025.
Investing Activities: Net cash used in investing activities consistently increased from US$340,900 thousand in 2021 to US$3,770,000 thousand in 2024. This is primarily due to escalating purchases of available-for-sale debt securities. While sales and maturities of these securities provide some offsetting inflows, they are insufficient to counteract the purchases. In 2025, net cash used in investing activities decreased to US$945,400 thousand, suggesting a reduction in investment activity. Notable specific transactions include a US$295,900 thousand payment for the acquisition of ViaCyte, Inc. in 2022 and a US$258,000 thousand acquisition from Alpine Immune Sciences, Inc. in 2024.
Financing Activities: Net cash used in financing activities was significant in 2021 (US$1,478,000 thousand) and 2024 (US$1,494,900 thousand), driven by substantial repurchases of common stock. Repurchases also contributed to a net outflow in 2025, though less pronounced at US$2,017,400 thousand. Issuances of common stock under benefit plans provide a consistent, though smaller, inflow. Payments related to employee tax obligations also represent a consistent outflow. A relatively small net cash outflow was observed in 2022 (US$67,700 thousand) and 2023 (US$562,200 thousand).
Cash Position: Cash, cash equivalents, and restricted cash increased from US$5,988,900 thousand in 2021 to US$6,800,100 thousand in 2022, and then to US$10,512,000 thousand in 2023. However, a substantial decrease occurred in 2024, falling to US$4,572,200 thousand, before a modest recovery to US$5,087,800 thousand in 2025. The net increase or decrease in cash closely mirrors the combined effects of operating, investing, and financing activities, with exchange rate effects having a relatively minor impact.
Non-Cash Items & Working Capital: Stock-based compensation expense and depreciation/amortization consistently contribute to adjustments increasing cash flow from operations, with both increasing over the period. Changes in operating assets and liabilities demonstrate significant volatility, particularly in 2022 and 2025, impacting overall operating cash flow. Increases in accounts payable and accrued expenses generally provide cash inflows, while increases in accounts receivable, inventories, and prepaid expenses represent cash outflows. An intangible asset impairment charge of US$379,000 thousand was recorded in 2025.

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Vertex Pharmaceuticals Inc. (NASDAQ:VRTX)

Cash Flow Statement