Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion weakened sharply from the prior quarter as operating cash flow fell while capital expenditure also declined, leading to a significantly lower free cash flow margin. Compared to the same quarter last year, free cash flow was slightly lower and the margin narrowed modestly.
- Revenue was slightly lower than the prior quarter, but operating cash flow decreased substantially, driving free cash flow lower. The free cash flow margin fell, reflecting a weaker conversion of revenue into free cash flow.
- Compared to the immediately preceding quarter, free cash flow and margin were both lower, with operating cash flow decreasing while capital expenditure also declined. Versus the same quarter one year earlier, free cash flow was slightly lower and margin modestly lower, as revenue was higher but operating cash flow was slightly lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$4.9B
Trailing twelve-month free cash flow.
Quarter free cash flow
$627.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.0B
Cash generated by operations before capital spending.
CapEx
$398.0M
Capital spending and related asset purchases.
FCF margin
6.3%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $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% |
| 2024-03-31 | $10.0B | $1.0B | $398.0M | $627.0M | 6.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 51.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.0% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$8.3B | 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 Decline
Operating cash flow for the quarter was substantially lower than the previous quarter and slightly lower than the same quarter last year. This decline was the strongest observable factor driving the reduction in free cash flow.
The lower operating cash flow directly reduced free cash flow and compressed the free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was slightly lower than the prior quarter, but operating cash flow decreased substantially, driving free cash flow lower. The free cash flow margin fell, reflecting a weaker conversion of revenue into free cash flow.
Compared to the immediately preceding quarter, free cash flow and margin were both lower, with operating cash flow decreasing while capital expenditure also declined. Versus the same quarter one year earlier, free cash flow was slightly lower and margin modestly lower, as revenue was higher but operating cash flow was slightly lower.
Monitor changes in operating cash flow, as the decline from both the prior quarter and the year-ago quarter was the primary factor behind the weaker free cash flow.