Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue, operating cash flow, and free cash flow all improved compared to both the prior quarter and the same quarter last year. The free cash flow margin strengthened significantly versus both periods.
- Operating cash flow was substantially higher than capital expenditure, resulting in a free cash flow margin that was higher than the operating cash flow margin implied by revenue alone, indicating efficient cash conversion.
- Compared to the prior quarter, revenue was higher, operating cash flow improved, capital expenditure was lower, and free cash flow and its margin both strengthened. Versus the same quarter one year earlier, all metrics improved: revenue was higher, operating cash flow and free cash flow were substantially higher, capital expenditure was lower, and the free cash flow margin was markedly higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$6.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.7B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.7B
Cash generated by operations before capital spending.
CapEx
$17.0M
Capital spending and related asset purchases.
FCF margin
38.8%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $4.1B | $925.0M | $50.0M | $875.0M | 21.5% |
| 2023-12-31 | $4.2B | $2.1B | $50.0M | $2.1B | 50.2% |
| 2024-03-31 | $4.3B | $1.4B | $52.0M | $1.4B | 32.2% |
| 2024-06-30 | $4.4B | $1.7B | $17.0M | $1.7B | 38.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 205.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.4% | 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 Growth
Operating cash flow was higher than both the prior quarter and the same quarter last year, with the year-over-year increase being particularly notable. This was the strongest observable driver of free cash flow improvement.
The higher operating cash flow directly lifted free cash flow and the free cash flow margin, even as capital expenditure remained modest.
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 free cash flow margin that was higher than the operating cash flow margin implied by revenue alone, indicating efficient cash conversion.
Compared to the prior quarter, revenue was higher, operating cash flow improved, capital expenditure was lower, and free cash flow and its margin both strengthened. Versus the same quarter one year earlier, all metrics improved: revenue was higher, operating cash flow and free cash flow were substantially higher, capital expenditure was lower, and the free cash flow margin was markedly higher.
Monitor the level of capital expenditure, which decreased from both the prior quarter and the year-ago quarter, as a sustained low level may affect future cash conversion.