Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and operating cash flow both improved compared to the prior quarter, while free cash flow margin strengthened. Versus the same quarter last year, revenue was lower but free cash flow margin was higher due to a significant reduction in capital expenditure.
- Operating cash flow as a proportion of revenue was higher than both the prior quarter and the year-ago quarter, supporting a free cash flow margin that improved sequentially and year-over-year. Capital expenditure was lower than the year-ago quarter, contributing to the margin expansion.
- Compared to the prior quarter, revenue, operating cash flow, and free cash flow were all higher, and free cash flow margin improved. Versus the same quarter last year, revenue was lower, but free cash flow was higher and free cash flow margin strengthened, driven by a substantially lower capital expenditure.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$885.4M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.1B
Cash generated by operations before capital spending.
CapEx
$165.4M
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 |
|---|---|---|---|---|---|
| 2024-02-03 | $2.5B | $1.1B | $223.0M | $915.9M | 36.4% |
| 2024-05-04 | $2.2B | $807.9M | $188.2M | $619.7M | 28.7% |
| 2024-08-03 | $2.3B | $855.0M | $153.9M | $701.1M | 30.3% |
| 2024-11-02 | $2.4B | $1.1B | $165.4M | $885.4M | 36.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 185.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 6.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$5.0B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Capital Expenditure Reduction
Capital expenditure was substantially lower than the same quarter last year, which directly boosted free cash flow and free cash flow margin despite lower revenue. The sequential increase in operating cash flow also supported the improvement.
The lower capital expenditure was the strongest observable driver of the higher free cash flow margin compared to the year-ago quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a proportion of revenue was higher than both the prior quarter and the year-ago quarter, supporting a free cash flow margin that improved sequentially and year-over-year. Capital expenditure was lower than the year-ago quarter, contributing to the margin expansion.
Compared to the prior quarter, revenue, operating cash flow, and free cash flow were all higher, and free cash flow margin improved. Versus the same quarter last year, revenue was lower, but free cash flow was higher and free cash flow margin strengthened, driven by a substantially lower capital expenditure.
Monitor the trend in capital expenditure, as its sharp decline from the year-ago level was the primary factor behind the free cash flow margin improvement.