Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the current quarter, free cash flow was negative as capital expenditure exceeded operating cash flow. Revenue and operating cash flow improved compared to the same quarter last year but declined from the prior quarter.
- Operating cash flow was positive but insufficient to cover capital expenditure, resulting in a negative free cash flow margin. The conversion from revenue to cash was weaker than the preceding quarter.
- Compared to the immediately preceding quarter, revenue and operating cash flow were lower, while capital expenditure was higher, leading to a shift from positive to negative free cash flow. Relative to the same quarter one year earlier, revenue and operating cash flow were higher, capital expenditure was slightly higher, and free cash flow improved (less negative).
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$1.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$302.4M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$411.2M
Cash generated by operations before capital spending.
CapEx
$713.6M
Capital spending and related asset purchases.
FCF margin
-43.1%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $587.6M | $238.2M | $722.5M | -$484.3M | -82.4% |
| 2023-12-31 | $1.2B | $245.3M | $769.6M | -$524.4M | -45.3% |
| 2024-03-31 | $1.6B | $746.6M | $645.9M | $100.7M | 6.1% |
| 2024-06-30 | $701.5M | $411.2M | $713.6M | -$302.4M | -43.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -182.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 101.7% | 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.
Capital expenditure funding
Capital expenditure remained elevated and exceeded operating cash flow, driving negative free cash flow. The filing notes that liquidity for capital expenditures is provided by a combination of internal cash flows and external financing.
If capital expenditure continues to outpace operating cash flow, free cash flow may remain negative and reliance on external financing could persist.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was positive but insufficient to cover capital expenditure, resulting in a negative free cash flow margin. The conversion from revenue to cash was weaker than the preceding quarter.
Compared to the immediately preceding quarter, revenue and operating cash flow were lower, while capital expenditure was higher, leading to a shift from positive to negative free cash flow. Relative to the same quarter one year earlier, revenue and operating cash flow were higher, capital expenditure was slightly higher, and free cash flow improved (less negative).
Monitor the level of capital expenditure relative to operating cash flow, as the gap widened sequentially.