Cash flow break-even point

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Cash flow break-even point

The point below which the firm will need either to obtain additional financing or to liquidate some of its assets to meet its fixed costs.

Cash Flow Break-Even Point

The cash flow necessary to cover costs and prevent a firm from operating at a loss. The break-even point may be relatively stable or it may fluctuate, depending on the company or industry. Companies with high break-even points tend to have large fluctuations in earnings from year to year.