Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was slightly lower than the prior quarter and higher than the same quarter last year. Operating cash flow rose versus the prior quarter but fell compared to a year ago, resulting in a free cash flow margin that improved from the prior quarter but declined from the year-ago period.
- Operating cash flow exceeded capital expenditure, producing positive free cash flow. The free cash flow margin was higher than in the immediately preceding quarter but lower than in the same quarter one year earlier, indicating a mixed conversion efficiency relative to revenue.
- Compared to the prior quarter, revenue was lower while operating cash flow and free cash flow were both higher, leading to an improved free cash flow margin. Versus the same quarter last year, revenue was higher, but both operating cash flow and free cash flow were lower, resulting in a weakened margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$9.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$3.2B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$3.4B
Cash generated by operations before capital spending.
CapEx
$180.3M
Capital spending and related asset purchases.
FCF margin
20.2%
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 |
|---|---|---|---|---|---|
| 2022-11-30 | $15.7B | $495.4M | $98.8M | $396.6M | 2.5% |
| 2023-02-28 | $15.8B | $2.3B | $107.5M | $2.2B | 14.1% |
| 2023-05-31 | $16.6B | $3.3B | $141.5M | $3.1B | 19.0% |
| 2023-08-31 | $16.0B | $3.4B | $180.3M | $3.2B | 20.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 235.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.1% | 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 Growth
Operating cash flow increased compared to the prior quarter, contributing to a higher sequential free cash flow and an improved margin.
This sequential improvement in operating cash flow was the strongest observable driver of the quarter's cash conversion performance.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow exceeded capital expenditure, producing positive free cash flow. The free cash flow margin was higher than in the immediately preceding quarter but lower than in the same quarter one year earlier, indicating a mixed conversion efficiency relative to revenue.
Compared to the prior quarter, revenue was lower while operating cash flow and free cash flow were both higher, leading to an improved free cash flow margin. Versus the same quarter last year, revenue was higher, but both operating cash flow and free cash flow were lower, resulting in a weakened margin.
Monitor the trend in operating cash flow relative to revenue, as it declined year over year despite higher revenue.