Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was higher than the preceding quarter and significantly higher than the same quarter one year earlier. Operating cash flow improved markedly from the prior quarter, leading to a less negative free cash flow margin, though capital expenditure also increased.
- Revenue increased, while operating cash flow rose more than proportionally, resulting in a higher cash conversion rate. However, capital expenditure also increased, offsetting some of the operating cash flow improvement, making free cash flow negative but at a smaller margin compared to the prior quarter.
- Compared to the preceding quarter, revenue was slightly higher, operating cash flow was substantially higher, and capital expenditure was higher, resulting in a less negative free cash flow margin. Compared to the same quarter one year earlier, revenue was higher, operating cash flow was higher, but capital expenditure was also higher, and free cash flow turned from positive to negative.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$69.6M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$2.3M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$36.3M
Cash generated by operations before capital spending.
CapEx
$38.6M
Capital spending and related asset purchases.
FCF margin
-5.4%
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 |
|---|---|---|---|---|---|
| 2023-05-31 | $22.0M | $4.6M | $35.1M | -$30.5M | -138.3% |
| 2023-08-31 | $36.3M | $4.5M | $32.6M | -$28.1M | -77.3% |
| 2023-11-30 | $42.2M | $4.5M | $13.2M | -$8.7M | -20.6% |
| 2024-02-29 | $43.3M | $36.3M | $38.6M | -$2.3M | -5.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 3.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 89.1% | 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 increased compared to both the prior quarter and the same quarter last year, and the increase was larger relative to the change in revenue.
This growth supported a notable improvement in the free cash flow margin compared to the prior quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased, while operating cash flow rose more than proportionally, resulting in a higher cash conversion rate. However, capital expenditure also increased, offsetting some of the operating cash flow improvement, making free cash flow negative but at a smaller margin compared to the prior quarter.
Compared to the preceding quarter, revenue was slightly higher, operating cash flow was substantially higher, and capital expenditure was higher, resulting in a less negative free cash flow margin. Compared to the same quarter one year earlier, revenue was higher, operating cash flow was higher, but capital expenditure was also higher, and free cash flow turned from positive to negative.
Monitor the trend in capital expenditure, as it increased significantly from the prior quarter and exceeded operating cash flow in the current quarter.