Here's Why We're Not At All Concerned With Vimeo's (NASDAQ:VMEO) Cash Burn Situation

Just because a business does not make any money, does not mean that the stock will go down. For example, biotech and mining exploration companies often lose money for years before finding success with a new treatment or mineral discovery. But the harsh reality is that very many loss making companies burn through all their cash and go bankrupt.So should Vimeo (NASDAQ:VMEO) shareholders be worried about its cash burn? In this report, we will consider the company’s annual negative free cash flow, henceforth referring to it as the ‘cash burn’. First, we’ll determine its cash runway by comparing its cash burn with its cash reserves. View our latest analysis for Vimeo When Might Vimeo Run Out Of Money?A company’s cash runway is calculated by dividing its cash hoard by its cash burn. In March 2023, Vimeo had US$268m in cash, and was debt-free. In the last year, its cash burn was US$12m. That means it had a cash runway of very many years as of March 2023. Notably, however, analysts think that Vimeo will break even (at a free cash flow level) before then. In that case, it may never reach the end of its cash runway. Depicted below, you
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