Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and free cash flow improved compared to both the prior quarter and the same quarter last year. Operating cash flow was lower than the immediate prior quarter but higher than the year-ago quarter.
- Cash conversion from revenue to free cash flow was supported by a moderate operating cash flow margin, while capital expenditure remained minimal. The free cash flow margin strengthened sequentially and year-over-year.
- Compared to the immediately preceding quarter, operating cash flow and free cash flow were lower, but revenue was higher and the free cash flow margin weakened. Versus the same quarter one year earlier, all metrics improved except for capital expenditure, which was slightly higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.9B
Trailing twelve-month free cash flow.
Quarter free cash flow
$900.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$909.0M
Cash generated by operations before capital spending.
CapEx
$9.0M
Capital spending and related asset purchases.
FCF margin
36.2%
The share of revenue converted into free cash flow.
Cash flow trend
A short quarterly history shows whether FCF is scaling with revenue or only spiking for one period.
| Period | Revenue | Operating CF | CapEx | FCF | FCF margin |
|---|---|---|---|---|---|
| 2022-09-30 | $2.9B | $964.0M | $6.0M | $958.0M | 33.2% |
| 2022-12-31 | $1.9B | $463.0M | $8.0M | $455.0M | 23.9% |
| 2023-03-31 | $1.8B | $1.6B | $6.0M | $1.6B | 87.0% |
| 2023-06-30 | $2.5B | $909.0M | $9.0M | $900.0M | 36.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 138.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.4% | Lower capital intensity usually supports FCF margin. |
| Net cash | n/a | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Operating Cash Flow vs. Revenue
The strongest observable driver is revenue growth, which increased from the prior quarter and the year-ago quarter. However, operating cash flow declined sequentially despite higher revenue, suggesting a shift in cash conversion efficiency.
This divergence between revenue and operating cash flow may affect future free cash flow generation if not addressed.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Cash conversion from revenue to free cash flow was supported by a moderate operating cash flow margin, while capital expenditure remained minimal. The free cash flow margin strengthened sequentially and year-over-year.
Compared to the immediately preceding quarter, operating cash flow and free cash flow were lower, but revenue was higher and the free cash flow margin weakened. Versus the same quarter one year earlier, all metrics improved except for capital expenditure, which was slightly higher.
Monitor the relationship between operating cash flow and revenue in future quarters, as operating cash flow decreased despite revenue growth compared to the prior quarter.