Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Operating cash flow improved versus the prior year but weakened sequentially, while capital expenditure rose in both comparisons. Free cash flow remained negative, with the margin narrowing slightly from a year ago but widening from the prior quarter.
- Revenue increased from both the prior quarter and the year-ago quarter, yet operating cash flow was lower than the prior quarter, resulting in a weaker cash conversion. The free cash flow margin was negative in all periods, reflecting capital expenditure exceeding operating cash flow.
- Compared to the prior quarter, revenue was higher but operating cash flow was lower, leading to a more negative free cash flow and a weakened margin. Versus the year-ago quarter, revenue and operating cash flow were both higher, and free cash flow improved slightly with a narrower negative margin.
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
-$435.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$496.0M
Cash generated by operations before capital spending.
CapEx
$931.0M
Capital spending and related asset purchases.
FCF margin
-21.1%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $1.7B | $484.0M | $764.0M | -$280.0M | -16.2% |
| 2022-09-30 | $2.3B | $727.0M | $899.0M | -$172.0M | -7.5% |
| 2022-12-31 | $2.0B | $664.0M | $914.0M | -$250.0M | -12.2% |
| 2023-03-31 | $2.1B | $496.0M | $931.0M | -$435.0M | -21.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -164.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 45.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$14.3B | 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 Growth
Capital expenditure increased from both the prior quarter and the year-ago quarter, outpacing the growth in operating cash flow. This was the strongest observable driver of the negative free cash flow and the widened margin deficit sequentially.
Higher capital expenditure directly contributed to a more negative free cash flow compared to the prior quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased from both the prior quarter and the year-ago quarter, yet operating cash flow was lower than the prior quarter, resulting in a weaker cash conversion. The free cash flow margin was negative in all periods, reflecting capital expenditure exceeding operating cash flow.
Compared to the prior quarter, revenue was higher but operating cash flow was lower, leading to a more negative free cash flow and a weakened margin. Versus the year-ago quarter, revenue and operating cash flow were both higher, and free cash flow improved slightly with a narrower negative margin.
Monitor the trajectory of capital expenditure relative to operating cash flow, as the gap widened sequentially and remained substantial year over year.