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 the prior quarter and was higher than the year-ago period.
- Operating cash flow as a proportion of revenue was higher than both the prior quarter and the year-ago quarter, while capital expenditure was lower in absolute terms. This combination resulted in a free cash flow margin that improved sequentially and was above the prior-year level.
- Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all higher, and the free cash flow margin strengthened. Versus the same quarter one year earlier, revenue, operating cash flow, and free cash flow were also higher, with the free cash flow margin showing improvement.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$614.8M
Trailing twelve-month free cash flow.
Quarter free cash flow
$368.9M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$374.5M
Cash generated by operations before capital spending.
CapEx
$5.6M
Capital spending and related asset purchases.
FCF margin
27.3%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $1.1B | $101.1M | $8.9M | $92.2M | 8.8% |
| 2022-09-30 | $1.2B | $134.1M | $10.4M | $123.7M | 10.5% |
| 2022-12-31 | $1.3B | $40.5M | $10.5M | $30.0M | 2.4% |
| 2023-03-31 | $1.4B | $374.5M | $5.6M | $368.9M | 27.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 84.5% | 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 Strength
Operating cash flow was substantially higher than both the prior quarter and the year-ago quarter, driving a significant improvement in free cash flow. The free cash flow margin rose accordingly.
The higher operating cash flow was the primary factor behind the improved free cash flow and margin this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a proportion of revenue was higher than both the prior quarter and the year-ago quarter, while capital expenditure was lower in absolute terms. This combination resulted in a free cash flow margin that improved sequentially and was above the prior-year level.
Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all higher, and the free cash flow margin strengthened. Versus the same quarter one year earlier, revenue, operating cash flow, and free cash flow were also higher, with the free cash flow margin showing improvement.
Monitor the trend in capital expenditure, which was lower in the current quarter compared to both the prior quarter and the year-ago quarter.