Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow declined from the prior quarter and the year-ago quarter, as a higher capital expenditure more than offset a slight increase in operating cash flow. The free cash flow margin weakened sequentially and compared to the same period last year.
- Revenue rose from both the prior quarter and the year-ago quarter, while operating cash flow improved modestly versus both periods. However, capital expenditure increased at a faster pace, resulting in lower free cash flow and a narrower free cash flow margin.
- Compared to the immediately preceding quarter, free cash flow and free cash flow margin are lower. Compared to the same quarter one year earlier, both free cash flow and free cash flow margin are also lower. Operating cash flow is higher than both comparison quarters, while capital expenditure is significantly higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$43.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$3.4B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$26.0B
Cash generated by operations before capital spending.
CapEx
$22.6B
Capital spending and related asset purchases.
FCF margin
2.1%
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 |
|---|---|---|---|---|---|
| 2023-12-31 | $170.0B | $42.5B | $14.6B | $27.9B | 16.4% |
| 2024-03-31 | $143.3B | $19.0B | $14.9B | $4.1B | 2.8% |
| 2024-06-30 | $148.0B | $25.3B | $17.6B | $7.7B | 5.2% |
| 2024-09-30 | $158.9B | $26.0B | $22.6B | $3.4B | 2.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 21.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 14.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | $14.6B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Capital Expenditure Increase
Capital expenditure rose substantially from both the prior quarter and the year-ago quarter, outpacing the growth in operating cash flow and leading to a lower free cash flow result.
The elevated capital expenditure is the strongest observable driver of the current quarter's weakened free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue rose from both the prior quarter and the year-ago quarter, while operating cash flow improved modestly versus both periods. However, capital expenditure increased at a faster pace, resulting in lower free cash flow and a narrower free cash flow margin.
Compared to the immediately preceding quarter, free cash flow and free cash flow margin are lower. Compared to the same quarter one year earlier, both free cash flow and free cash flow margin are also lower. Operating cash flow is higher than both comparison quarters, while capital expenditure is significantly higher.
Monitor the trajectory of capital expenditure, as its increase was the primary factor compressing free cash flow in the current quarter.