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.

Eli Lilly & Co., consolidated cash flow statement

US$ in millions

12 months ended:	Dec 31, 2025	Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021
Net income	20,640)	10,590)	5,240)	6,245)	5,582)
Depreciation and amortization	1,997)	1,767)	1,527)	1,523)	1,548)
Debt extinguishment loss	—)	—)	—)	—)	405)
Change in deferred income taxes	(1,707)	(2,683)	(2,341)	(2,185)	(802)
Stock-based compensation expense	626)	646)	629)	371)	343)
Gains on sale of product rights	(180)	(224)	(1,879)	(157)	(216)
Acquired in-process research and development	2,910)	3,280)	3,800)	421)	875)
Other operating activities, net	620)	827)	319)	881)	549)
Receivables, (increase) decrease	(7,000)	(2,155)	(2,451)	(300)	(1,278)
Inventories, (increase) decrease	(4,671)	(2,507)	(1,425)	(600)	(236)
Prepaid expenses and other assets, (increase) decrease	(6,609)	(3,331)	(3,453)	(794)	1,515)
Accounts payable and other liabilities, increase (decrease)	10,187)	2,609)	4,274)	1,678)	(1,024)
Other changes in operating assets and liabilities, net of acquisitions and divestitures	(8,093)	(5,385)	(3,055)	(15)	(1,023)
Adjustments to reconcile net income to cash flows from operating activities	(3,827)	(1,772)	(1,000)	840)	1,679)
Net cash provided by operating activities	16,813)	8,818)	4,240)	7,084)	7,261)
Purchases of property and equipment	(7,841)	(5,058)	(3,448)	(1,854)	(1,310)
Proceeds from sales of and distributions from noncurrent investments	964)	374)	508)	342)	800)
Purchases of noncurrent investments	(645)	(677)	(731)	(600)	(930)
Proceeds from sale of product rights	218)	601)	1,604)	96)	216)
Purchases of in-process research and development	(3,008)	(3,346)	(3,945)	(630)	(563)
Cash paid for acquisitions, net of cash acquired	(661)	(948)	(1,044)	(327)	(747)
Other investing activities, net	1)	(248)	(98)	(288)	(228)
Net cash used for investing activities	(10,972)	(9,302)	(7,153)	(3,262)	(2,762)
Dividends paid	(5,384)	(4,680)	(4,069)	(3,536)	(3,087)
Net change in short-term borrowings	(4,338)	(1,852)	4,691)	1,498)	(4)
Proceeds from issuance of long-term debt	13,167)	11,417)	3,959)	—)	2,411)
Repayments of long-term debt	(778)	(664)	—)	(1,560)	(1,905)
Purchases of common stock	(4,108)	(2,500)	(750)	(1,500)	(1,250)
Other financing activities, net	(772)	(491)	(335)	(309)	(296)
Net cash provided by (used for) financing activities	(2,213)	1,230)	3,496)	(5,407)	(4,131)
Effect of exchange rate changes on cash and cash equivalents	372)	(297)	169)	(168)	(206)
Net increase (decrease) in cash and cash equivalents	4,000)	450)	752)	(1,752)	161)
Cash and cash equivalents at beginning of year	3,268)	2,819)	2,067)	3,819)	3,657)
Cash and cash equivalents at end of year	7,268)	3,268)	2,819)	2,067)	3,819)

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 company demonstrates a generally positive trend in net income over the observed period, with significant growth from 2023 onwards. However, cash flow patterns reveal a more complex picture, characterized by fluctuations in operating, investing, and financing activities.

Operating Activities: Net cash provided by operating activities initially remains relatively stable between 2021 and 2022, at approximately US$7.1 billion. A decrease is observed in 2023, falling to US$4.2 billion, before a substantial increase to US$8.8 billion in 2024 and further growth to US$16.8 billion in 2025. This increase correlates with the significant rise in net income during the same period. Adjustments to reconcile net income to cash flows from operating activities show a shift from positive adjustments in the earlier years to negative adjustments in 2023, 2024, and 2025, primarily driven by increasing gains on sale of product rights and acquired in-process research and development. Working capital components exhibit considerable volatility. Receivables, inventories, and prepaid expenses consistently represent cash outflows (increases), with the magnitude of these outflows increasing substantially in the later years. Accounts payable and other liabilities generally provide a cash inflow (increase), also growing significantly in 2024 and 2025.
Investing Activities: Net cash used for investing activities consistently represents a significant outflow throughout the period, escalating from US$2.8 billion in 2021 to US$10.97 billion in 2025. This is largely attributable to substantial purchases of property and equipment, and in-process research and development. Proceeds from sales of product rights and noncurrent investments provide partial offsets, but are insufficient to counteract the overall outflow. Cash paid for acquisitions also contributes to the negative cash flow from investing activities.
Financing Activities: Net cash provided by (used for) financing activities fluctuates considerably. 2021 and 2022 show significant cash outflows, primarily due to dividend payments and purchases of common stock. 2023 demonstrates a shift to positive cash flow, driven by proceeds from the issuance of long-term debt and net changes in short-term borrowings. However, this trend reverses in 2024 and 2025, with substantial outflows related to dividend payments, purchases of common stock, and repayments of long-term debt. The issuance of long-term debt provides a significant inflow in 2024 and 2025, but is not enough to offset the other outflows.
Cash and Cash Equivalents: The net increase (decrease) in cash and cash equivalents is volatile. A slight increase is observed in 2021, followed by a substantial decrease in 2022. Cash levels recover in 2023 and 2024, with a significant increase in 2025, resulting in a final balance of US$7.27 billion. The effect of exchange rate changes on cash and cash equivalents is relatively minor, with fluctuations between inflows and outflows.

Overall, the company’s cash flow statement reflects a period of significant growth in net income, coupled with substantial investments in property, equipment, and research and development. While operating activities generate increasing cash flow, this is offset by substantial cash outflows from investing and, at times, financing activities. The company relies on a combination of debt financing and internal cash generation to fund its operations and investments.

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Eli Lilly & Co. (NYSE:LLY)

Cash Flow Statement