Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved sequentially as operating cash flow rose and capital expenditure declined, though the margin remained below the year-ago level. Revenue was slightly lower than the prior quarter but higher than the same quarter last year.
- Operating cash flow of nearly half a billion dollars, combined with minimal capital expenditure, produced a free cash flow margin that improved from the prior quarter but weakened compared to the same quarter one year earlier.
- Compared to the immediately preceding quarter, free cash flow and operating cash flow were higher while revenue was slightly lower. Versus the same quarter one year earlier, free cash flow and operating cash flow were lower despite higher revenue.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$487.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$494.0M
Cash generated by operations before capital spending.
CapEx
$7.0M
Capital spending and related asset purchases.
FCF margin
34.4%
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 |
|---|---|---|---|---|---|
| 2023-07-31 | $1.3B | $135.0M | $7.0M | $128.0M | 9.5% |
| 2023-10-31 | $1.4B | $18.0M | $5.0M | $13.0M | 0.9% |
| 2024-01-31 | $1.5B | $437.0M | $10.0M | $427.0M | 29.1% |
| 2024-04-30 | $1.4B | $494.0M | $7.0M | $487.0M | 34.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 193.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.5% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$619.0M | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Sequential Operating Cash Flow Improvement
Operating cash flow increased from the prior quarter, while capital expenditure decreased, leading to a higher free cash flow and an improved free cash flow margin sequentially.
This sequential strengthening in cash generation supported a higher free cash flow margin compared to the prior quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow of nearly half a billion dollars, combined with minimal capital expenditure, produced a free cash flow margin that improved from the prior quarter but weakened compared to the same quarter one year earlier.
Compared to the immediately preceding quarter, free cash flow and operating cash flow were higher while revenue was slightly lower. Versus the same quarter one year earlier, free cash flow and operating cash flow were lower despite higher revenue.
Monitor the trajectory of operating cash flow relative to revenue, as the year-over-year decline in cash conversion occurred despite higher revenue.