Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The company posted a negative free cash flow margin as capital expenditure surpassed operating cash flow. Revenue rose compared with both the prior quarter and the same quarter last year, but operating cash flow declined from the prior quarter.
- Operating cash flow was lower than capital expenditure, resulting in negative free cash flow. The free cash flow margin weakened compared with both the prior quarter and the year-ago quarter.
- Compared with the prior quarter, revenue was higher but operating cash flow was lower, and free cash flow was more negative. Versus the same quarter a year ago, both revenue and operating cash flow were higher, but capital expenditure increased substantially, leading to a more negative free cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$2.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$926.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$625.0M
Cash generated by operations before capital spending.
CapEx
$1.6B
Capital spending and related asset purchases.
FCF margin
-28.6%
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 | $3.1B | $408.0M | $893.0M | -$485.0M | -15.8% |
| 2022-09-30 | $3.6B | $784.0M | $1.1B | -$268.0M | -7.4% |
| 2022-12-31 | $3.1B | $1.1B | $1.8B | -$774.0M | -25.3% |
| 2023-03-31 | $3.2B | $625.0M | $1.6B | -$926.0M | -28.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -613.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 47.9% | 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 Decline
Operating cash flow decreased from the prior quarter, while capital expenditure also decreased but at a slower rate, widening the free cash flow deficit.
The lower operating cash flow relative to capital expenditure drove the more negative free cash flow and margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was lower than capital expenditure, resulting in negative free cash flow. The free cash flow margin weakened compared with both the prior quarter and the year-ago quarter.
Compared with the prior quarter, revenue was higher but operating cash flow was lower, and free cash flow was more negative. Versus the same quarter a year ago, both revenue and operating cash flow were higher, but capital expenditure increased substantially, leading to a more negative free cash flow.
Monitor whether operating cash flow can increase to better cover the elevated capital expenditure.