Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was slightly lower than the prior quarter and the year-ago quarter, while operating cash flow and free cash flow improved markedly. The free cash flow margin strengthened significantly compared to both the preceding quarter and the same quarter one year earlier.
- Operating cash flow was substantially higher than capital expenditure, resulting in a large free cash flow. The free cash flow margin was elevated, indicating a high rate of revenue conversion into free cash flow.
- Compared to the immediately preceding quarter, revenue was lower but operating cash flow and free cash flow were higher, leading to an improved free cash flow margin. Versus the same quarter one year earlier, revenue was slightly lower while operating cash flow and free cash flow were substantially higher, with a strengthened free cash flow margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$7.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.3B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.6B
Cash generated by operations before capital spending.
CapEx
$255.0M
Capital spending and related asset purchases.
FCF margin
36.2%
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 |
|---|---|---|---|---|---|
| 2022-10-30 | $6.7B | $857.0M | $223.0M | $634.0M | 9.4% |
| 2023-01-29 | $6.7B | $2.3B | $287.0M | $2.0B | 29.4% |
| 2023-04-30 | $6.6B | $2.3B | $255.0M | $2.0B | 30.7% |
| 2023-07-30 | $6.4B | $2.6B | $255.0M | $2.3B | 36.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 149.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.0% | 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 Strength
Operating cash flow was higher than both the prior quarter and the year-ago quarter, even as revenue was slightly lower. This was the strongest observable driver of the free cash flow improvement.
The higher operating cash flow directly lifted free cash flow and the free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was substantially higher than capital expenditure, resulting in a large free cash flow. The free cash flow margin was elevated, indicating a high rate of revenue conversion into free cash flow.
Compared to the immediately preceding quarter, revenue was lower but operating cash flow and free cash flow were higher, leading to an improved free cash flow margin. Versus the same quarter one year earlier, revenue was slightly lower while operating cash flow and free cash flow were substantially higher, with a strengthened free cash flow margin.
Monitor whether operating cash flow can sustain its elevated level relative to revenue in future quarters.