Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Cash conversion weakened compared to both the prior quarter and the same quarter last year. Revenue was stable sequentially but lower year over year, while operating cash flow and free cash flow declined in both comparisons.
- Operating cash flow and free cash flow were lower than revenue, resulting in a free cash flow margin that narrowed from the prior quarter and was significantly below the year-ago level. Capital expenditure was slightly reduced sequentially but remained similar to the year-ago period.
- Compared to the immediately preceding quarter, revenue was stable while operating cash flow and free cash flow were lower, leading to a weakened free cash flow margin. Versus the same quarter one year earlier, revenue, operating cash flow, and free cash flow were all lower, with the margin declining substantially.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.9B
Trailing twelve-month free cash flow.
Quarter free cash flow
$254.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$379.0M
Cash generated by operations before capital spending.
CapEx
$125.0M
Capital spending and related asset purchases.
FCF margin
4.7%
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 |
|---|---|---|---|---|---|
| 2022-09-24 | $5.6B | $965.0M | $123.0M | $842.0M | 15.1% |
| 2022-12-31 | $5.6B | $567.0M | $124.0M | $443.0M | 7.9% |
| 2023-04-01 | $5.4B | $486.0M | $158.0M | $328.0M | 6.1% |
| 2023-07-01 | $5.4B | $379.0M | $125.0M | $254.0M | 4.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 940.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.3% | Lower capital intensity usually supports FCF margin. |
| Net cash | $1.4B | 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 and was substantially lower than the year-ago quarter, while revenue was stable sequentially. This divergence suggests a weaker cash conversion from revenue.
The lower operating cash flow directly reduced free cash flow and compressed 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 and free cash flow were lower than revenue, resulting in a free cash flow margin that narrowed from the prior quarter and was significantly below the year-ago level. Capital expenditure was slightly reduced sequentially but remained similar to the year-ago period.
Compared to the immediately preceding quarter, revenue was stable while operating cash flow and free cash flow were lower, leading to a weakened free cash flow margin. Versus the same quarter one year earlier, revenue, operating cash flow, and free cash flow were all lower, with the margin declining substantially.
Monitor whether operating cash flow can stabilize or improve, as it is the primary driver of free cash flow given the relatively stable capital expenditure.