Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved sharply from the prior quarter, driven by a strong increase in operating cash flow. Compared to the same quarter last year, free cash flow and margin were also higher.
- Revenue was lower than the prior quarter but higher than a year ago. Operating cash flow rose notably, leading to higher free cash flow and an improved free cash flow margin.
- Compared to the immediately preceding quarter, free cash flow and margin were higher, while revenue was lower. Versus the same quarter one year earlier, all metrics were higher except capital expenditure, which was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$12.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$3.7B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$3.8B
Cash generated by operations before capital spending.
CapEx
$149.7M
Capital spending and related asset purchases.
FCF margin
20.3%
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 |
|---|---|---|---|---|---|
| 2025-05-31 | $17.7B | $3.7B | $169.1M | $3.5B | 19.8% |
| 2025-08-31 | $17.6B | $3.9B | $107.9M | $3.8B | 21.6% |
| 2025-11-30 | $18.7B | $1.7B | $156.6M | $1.5B | 8.0% |
| 2026-02-28 | $18.0B | $3.8B | $149.7M | $3.7B | 20.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 201.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.8% | 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.
Collections on client balances
The filing notes that the increase in operating cash flow was primarily due to higher collections on net client balances, including receivables, contract assets, and deferred revenues.
This improvement in collections was the strongest observable driver of the quarter's cash conversion.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than the prior quarter but higher than a year ago. Operating cash flow rose notably, leading to higher free cash flow and an improved free cash flow margin.
Compared to the immediately preceding quarter, free cash flow and margin were higher, while revenue was lower. Versus the same quarter one year earlier, all metrics were higher except capital expenditure, which was lower.
Monitor the level of cash and cash equivalents, which decreased from the prior fiscal year-end.