Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved versus both the prior quarter and the year-ago quarter, supported by higher operating cash flow. The free cash flow margin widened compared with both periods.
- Revenue was stable between periods, while operating cash flow increased, leading to higher free cash flow. Capital expenditure was higher quarter over quarter but lower than the year-ago quarter, and the free cash flow margin rose accordingly.
- Compared with the immediately preceding quarter, operating cash flow and free cash flow were higher, and the free cash flow margin improved. Compared with the same quarter one year earlier, all metrics were higher, with a stronger free cash flow margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$5.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.3B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$3.0B
Cash generated by operations before capital spending.
CapEx
$755.0M
Capital spending and related asset purchases.
FCF margin
22.3%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $9.7B | $1.1B | $380.0M | $763.0M | 7.8% |
| 2023-06-30 | $10.0B | $1.2B | $507.0M | $696.0M | 7.0% |
| 2023-09-30 | $10.1B | $1.9B | $560.0M | $1.3B | 13.0% |
| 2023-12-31 | $10.2B | $3.0B | $755.0M | $2.3B | 22.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 143.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 7.4% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$7.8B | 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 strength
Operating cash flow was higher than both the prior quarter and the year-ago quarter, providing the primary support for the increase in free cash flow. Revenue was essentially stable, so the cash conversion improvement was driven by a higher operating cash flow relative to revenue.
The stronger operating cash flow was the most observable factor behind the improved free cash flow and margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable between periods, while operating cash flow increased, leading to higher free cash flow. Capital expenditure was higher quarter over quarter but lower than the year-ago quarter, and the free cash flow margin rose accordingly.
Compared with the immediately preceding quarter, operating cash flow and free cash flow were higher, and the free cash flow margin improved. Compared with the same quarter one year earlier, all metrics were higher, with a stronger free cash flow margin.
Monitor whether the elevated capital expenditure level persists in subsequent quarters relative to the prior period.