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 and the same quarter last year. Free cash flow margin strengthened year over year but weakened sequentially.
- Operating cash flow of the current quarter was higher than the year-ago quarter but lower than the prior quarter. Capital expenditure increased year over year but was stable sequentially, resulting in free cash flow that improved from the year-ago quarter and weakened from the prior quarter. The free cash flow margin followed the same pattern.
- Compared to the prior quarter, revenue was higher but operating cash flow and free cash flow were lower, leading to a weakened free cash flow margin. Compared to the same quarter last year, all metrics were higher, with free cash flow margin improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$430.4M
Trailing twelve-month free cash flow.
Quarter free cash flow
$46.7M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$69.0M
Cash generated by operations before capital spending.
CapEx
$22.3M
Capital spending and related asset purchases.
FCF margin
5.1%
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 | $773.1M | $88.6M | $15.9M | $72.7M | 9.4% |
| 2022-09-30 | $913.7M | $158.0M | $16.9M | $141.1M | 15.4% |
| 2022-12-31 | $861.5M | $192.4M | $22.5M | $169.9M | 19.7% |
| 2023-03-31 | $923.0M | $69.0M | $22.3M | $46.7M | 5.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 37.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.4% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$1.8B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Revenue Growth
Revenue was higher than both the prior quarter and the year-ago quarter, providing a larger base for cash generation. This was the strongest observable driver of the improvement in free cash flow compared to the year-ago period.
Higher revenue supported a year-over-year increase in free cash flow despite a sequential decline in cash conversion efficiency.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow of the current quarter was higher than the year-ago quarter but lower than the prior quarter. Capital expenditure increased year over year but was stable sequentially, resulting in free cash flow that improved from the year-ago quarter and weakened from the prior quarter. The free cash flow margin followed the same pattern.
Compared to the prior quarter, revenue was higher but operating cash flow and free cash flow were lower, leading to a weakened free cash flow margin. Compared to the same quarter last year, all metrics were higher, with free cash flow margin improved.
Monitor the relationship between revenue growth and operating cash flow, as the sequential decline in cash conversion despite higher revenue may indicate a shift in cash flow quality.