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 Paychex (PAYX) spend its free cash flow?

For TTM through Q2 2026, Paychex generated $2.56B of operating cash flow and $2.32B of free cash flow — a free cash flow margin of 90.8% of operating cash flow. The waterfall breaks down how the remaining cash was allocated across investing and financing activities.

How much did Paychex (PAYX) return via buybacks and dividends?

The waterfall shows buybacks (share repurchases) and dividends paid as separate steps in the financing section. Together these represent Paychex's shareholder returns for TTM through Q2 2026. You can compare these against free cash flow to assess the capital-return payout ratio.

Paychex (PAYX) Cash Flow Waterfall

Operating CF

$2.56B

Capex

-$235M

Free Cash Flow

$2.32B

FCF Margin

+90.8%

Cash flow waterfall for Paychex (PAYX) — TTM through Q2 2026

Free cash flow: $2.32B

Note: Other Investing is large — driven mainly by acquisitions and investment activity.

Cash flow breakdown for Paychex (PAYX) — TTM through Q2 2026

Line item	Amount	Running total
Operating Cash Flow	$2.56B	$2.56B
Capital Expenditure	-$235M	$2.32B
Free Cash Flow	$2.32B	$2.32B
Other Investing	-$918M	$1.4B
Share Buybacks	-$611M	$793M
Dividends Paid	-$1.59B	-$796M
Net Debt Change	-$419M	-$1.22B
Other Financing & FX	-$34.4M	-$1.25B
Net Cash Decrease	-$1.25B	-$1.25B

Operating Cash Flow$2.56B
Capital Expenditure-$235M
Free Cash Flow$2.32B
Other Investing-$918M
Share Buybacks-$611M
Dividends Paid-$1.59B
Net Debt Change-$419M
Other Financing & FX-$34.4M
Net Cash Decrease-$1.25B

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

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