Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow for the quarter was higher than both the immediate prior quarter and the same quarter last year, driven by operating cash flow improvement. The free cash flow margin weakened slightly versus a year earlier but strengthened sequentially.
- Revenue was lower sequentially but higher compared to a year ago. Operating cash flow improved sequentially and year-over-year, while capital expenditure increased slightly in both periods. The resulting free cash flow and margin improved on a sequential basis but margin declined relative to the same quarter last year, indicating a mixed conversion trend.
- Compared to the immediately preceding quarter, free cash flow and margin improved as operating cash flow increased despite a minor revenue decline and slightly higher capex. Relative to the same quarter one year earlier, free cash flow increased marginally but margin weakened, as capex grew at a higher proportional rate than operating cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$17.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$4.4B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$4.5B
Cash generated by operations before capital spending.
CapEx
$122.0M
Capital spending and related asset purchases.
FCF margin
50.2%
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 |
|---|---|---|---|---|---|
| 2022-07-31 | $8.5B | $4.4B | $116.0M | $4.3B | 50.9% |
| 2022-10-30 | $8.9B | $4.6B | $122.0M | $4.5B | 50.0% |
| 2023-01-29 | $8.9B | $4.0B | $103.0M | $3.9B | 44.1% |
| 2023-04-30 | $8.7B | $4.5B | $122.0M | $4.4B | 50.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 125.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.4% | 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 increased both sequentially and year-over-year, providing the primary support for free cash flow growth even as revenue declined sequentially.
This sustained cash generation from operations drove sequential improvement in free cash flow despite higher capital spending.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower sequentially but higher compared to a year ago. Operating cash flow improved sequentially and year-over-year, while capital expenditure increased slightly in both periods. The resulting free cash flow and margin improved on a sequential basis but margin declined relative to the same quarter last year, indicating a mixed conversion trend.
Compared to the immediately preceding quarter, free cash flow and margin improved as operating cash flow increased despite a minor revenue decline and slightly higher capex. Relative to the same quarter one year earlier, free cash flow increased marginally but margin weakened, as capex grew at a higher proportional rate than operating cash flow.
The relationship between revenue movement and operating cash flow direction may warrant close tracking, as sequential revenue decline did not impede cash generation.