What is a cash flow waterfall?

A cash flow waterfall is a bar chart that walks from operating cash flow through capital expenditure to free cash flow, then shows how the remaining cash is allocated — acquisitions, buybacks, dividends, debt, and other financing — ending at the net change in cash. Each step is colour-coded: green bars add to the running total, red bars subtract.

How does Merck & Co. (MRK) spend its free cash flow?

For TTM through Q1 2026, Merck & Co. generated $17.9B of operating cash flow and $14.1B of free cash flow — a free cash flow margin of 78.9% of operating cash flow. The waterfall breaks down how the remaining cash was allocated across investing and financing activities.

How much did Merck & Co. (MRK) return via buybacks and dividends?

The waterfall shows buybacks (share repurchases) and dividends paid as separate steps in the financing section. Together these represent Merck & Co.'s shareholder returns for TTM through Q1 2026. You can compare these against free cash flow to assess the capital-return payout ratio.

Merck & Co. (MRK) Cash Flow Waterfall

Operating CF

$17.9B

Capex

-$3.78B

Free Cash Flow

$14.1B

FCF Margin

+78.9%

Cash flow waterfall for Merck & Co. (MRK) — TTM through Q1 2026

Free cash flow: $14.1B

Cash flow breakdown for Merck & Co. (MRK) — TTM through Q1 2026

Line item	Amount	Running total
Operating Cash Flow	$17.9B	$17.9B
Capital Expenditure	-$3.78B	$14.1B
Free Cash Flow	$14.1B	$14.1B
Acquisitions	-$18.8B	-$4.71B
Other Investing	$132M	-$4.57B
Share Buybacks	-$981M	-$5.56B
Dividends Paid	-$8.23B	-$13.8B
Net Debt Change	$13.8B	$12M
Other Financing	-$3.73B	-$3.72B
Forex Effect	$444M	-$3.28B
Net Cash Decrease	-$3.28B	-$3.28B

Operating Cash Flow$17.9B
Capital Expenditure-$3.78B
Free Cash Flow$14.1B
Acquisitions-$18.8B
Other Investing$132M
Share Buybacks-$981M
Dividends Paid-$8.23B
Net Debt Change$13.8B
Other Financing-$3.73B
Forex Effect$444M
Net Cash Decrease-$3.28B

Want to see what drove the FCF change?Free Cash Flow Bridge

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