Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned positive in the current quarter after a negative prior quarter, though it remained well below the year-ago level. The improvement was driven by a sharp increase in operating cash flow, while capital expenditure rose moderately.
- Revenue was slightly lower than the prior quarter but higher than a year ago. Operating cash flow improved significantly from the prior quarter, resulting in positive free cash flow and a free cash flow margin that turned positive, though it remained much lower than the year-ago margin.
- Compared to the prior quarter, free cash flow improved from negative to positive, driven by a much higher operating cash flow despite a slight decline in revenue. Versus the same quarter last year, free cash flow and free cash flow margin were both lower, as operating cash flow decreased and capital expenditure increased.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$469.4M
Trailing twelve-month free cash flow.
Quarter free cash flow
$83.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$628.9M
Cash generated by operations before capital spending.
CapEx
$545.9M
Capital spending and related asset purchases.
FCF margin
3.6%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $2.6B | $956.8M | $445.7M | $511.1M | 19.5% |
| 2023-03-31 | $2.6B | $721.0M | $415.6M | $305.4M | 11.8% |
| 2023-06-30 | $2.4B | $73.7M | $503.7M | -$430.0M | -18.1% |
| 2023-09-30 | $2.3B | $628.9M | $545.9M | $83.0M | 3.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 27.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 23.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$2.1B | 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 Recovery
Operating cash flow increased substantially from the prior quarter, reversing the negative free cash flow position. This was the strongest observable driver of the quarter's cash conversion improvement.
The recovery in operating cash flow was the key factor that brought free cash flow back to positive territory.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was slightly lower than the prior quarter but higher than a year ago. Operating cash flow improved significantly from the prior quarter, resulting in positive free cash flow and a free cash flow margin that turned positive, though it remained much lower than the year-ago margin.
Compared to the prior quarter, free cash flow improved from negative to positive, driven by a much higher operating cash flow despite a slight decline in revenue. Versus the same quarter last year, free cash flow and free cash flow margin were both lower, as operating cash flow decreased and capital expenditure increased.
Monitor the trend in operating cash flow, as its sharp recovery was the primary factor behind the swing to positive free cash flow.