Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was stable compared to the prior quarter and lower than the same quarter a year ago. Operating cash flow and free cash flow improved significantly, resulting in a higher free cash flow margin.
- The company converted a stable revenue base into higher operating cash flow, and with capital expenditure remaining relatively stable, free cash flow increased substantially. The free cash flow margin improved compared to both the prior quarter and the year-ago quarter.
- Compared to the immediately preceding quarter, operating cash flow and free cash flow were higher, while revenue was stable and capital expenditure slightly higher. Versus the same quarter one year earlier, revenue was lower but operating cash flow and free cash flow were higher, and capital expenditure was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$592.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$265.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$322.6M
Cash generated by operations before capital spending.
CapEx
$57.1M
Capital spending and related asset purchases.
FCF margin
12.7%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $2.0B | $345.8M | $94.9M | $250.9M | 12.4% |
| 2023-04-01 | $2.1B | $1.9M | $64.5M | -$62.6M | -3.0% |
| 2023-07-01 | $2.1B | $189.6M | $51.4M | $138.2M | 6.6% |
| 2023-09-30 | $2.1B | $322.6M | $57.1M | $265.5M | 12.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 192.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.7% | 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.
Operating cash flow uplift
Operating cash flow was higher than both the prior quarter and the year-ago quarter, despite stable or lower revenue. This drove the substantial increase in free cash flow and margin.
The improvement in operating cash flow was the primary factor behind the higher free cash flow and margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
The company converted a stable revenue base into higher operating cash flow, and with capital expenditure remaining relatively stable, free cash flow increased substantially. The free cash flow margin improved compared to both the prior quarter and the year-ago quarter.
Compared to the immediately preceding quarter, operating cash flow and free cash flow were higher, while revenue was stable and capital expenditure slightly higher. Versus the same quarter one year earlier, revenue was lower but operating cash flow and free cash flow were higher, and capital expenditure was lower.
Monitor the sustainability of the operating cash flow level relative to revenue, given the stable revenue trend.