Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was stable compared to the same quarter last year but increased from the prior quarter. Free cash flow margin improved from a year ago but declined from the preceding quarter.
- Although revenue rose slightly from the prior quarter, operating cash flow decreased, and capital expenditure increased, resulting in lower free cash flow and a narrower free cash flow margin. Compared to a year ago, operating cash flow was higher, and free cash flow margin improved despite higher capital expenditure.
- Compared to the preceding quarter, free cash flow was lower as operating cash flow declined and capital expenditure increased. Compared to the same quarter one year earlier, free cash flow was higher, driven by a substantial increase in operating cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$7.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.2B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.6B
Cash generated by operations before capital spending.
CapEx
$309.0M
Capital spending and related asset purchases.
FCF margin
18.5%
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 |
|---|---|---|---|---|---|
| 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% |
| 2023-10-29 | $6.7B | $1.6B | $309.0M | $1.2B | 18.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 62.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | $671.0M | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Sequential decline in operating cash flow efficiency
Revenue grew modestly from the prior quarter, but operating cash flow fell, compressing the free cash flow margin. The filing discusses risks and uncertainties that could affect future operations, but no direct cause for the sequential decline is identified.
The divergence between revenue growth and cash generation warrants attention.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Although revenue rose slightly from the prior quarter, operating cash flow decreased, and capital expenditure increased, resulting in lower free cash flow and a narrower free cash flow margin. Compared to a year ago, operating cash flow was higher, and free cash flow margin improved despite higher capital expenditure.
Compared to the preceding quarter, free cash flow was lower as operating cash flow declined and capital expenditure increased. Compared to the same quarter one year earlier, free cash flow was higher, driven by a substantial increase in operating cash flow.
Monitor the trajectory of free cash flow margin, which weakened sequentially after improving year-over-year.