# Let's talk about using two methods to calculate the cost of Stock-Based Compensation.
We will referance pages 92 & 93 of the [META 2025 10k](https://www.sec.gov/Archives/edgar/data/1326801/000162828026003942/meta-20251231.htm).
Start with $115,800 Operating Cashflow. Then deduct 69,691 for PP&E, and another 2,524 for Principal Payments on Finance Lease.
That leaves us with 43,585 Free Cash Flow.
Now let's look at two methods of deducting SBC. The **first method** is to deduct the SBC line item on the CF statement: 20,427.
**That leaves us with 23,158 of FCF.**
The **second method** would be to look the Statements of Stockholder's Equity. Meta issued 63 shares, withheld 27, netting 36 new shares. They repurchased 40. So 90% of repurchases were to offset SBC. We will come back to that 90% in a bit.
On that same statement, I will add these numbers together: 450 from the issuance of the 63 shares. -18,400 from the shares withheld. And then 90% of the share repurchases number, -26,264, which equals -23,638. Cumulatively, we have 450 - 18,400 - 23,638 = -41,588.
**Which leaves us about 1,997 of FCF.**
# Thoughts on each method?