Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow in Q4 improved versus the prior quarter but weakened compared with the same quarter a year earlier. The quarter's free cash flow margin strengthened relative to Q3 but declined from the prior-year period.
- Revenue was higher than the prior quarter, and operating cash flow rose sharply, resulting in a significantly higher free cash flow. The free cash flow margin increased compared with Q3, as capital expenditure also rose but at a smaller relative change.
- Compared with the preceding quarter, free cash flow and free cash flow margin both improved substantially. Versus the same quarter one year earlier, free cash flow was slightly lower and the free cash flow margin weakened despite higher revenue.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$129.6M
Trailing twelve-month free cash flow.
Quarter free cash flow
$116.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$140.0M
Cash generated by operations before capital spending.
CapEx
$24.0M
Capital spending and related asset purchases.
FCF margin
27.0%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $344.3M | -$56.3M | $8.5M | -$64.8M | -18.8% |
| 2023-06-30 | $373.3M | $42.7M | $13.1M | $29.5M | 7.9% |
| 2023-09-30 | $412.7M | $62.9M | $14.0M | $48.9M | 11.9% |
| 2023-12-31 | $430.4M | $140.0M | $24.0M | $116.0M | 27.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 203.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.6% | 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 Improvement
Operating cash flow increased markedly from the prior quarter, driving the improvement in free cash flow and margin despite higher capital expenditure.
This was the strongest observable driver of the quarter's cash conversion performance.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than the prior quarter, and operating cash flow rose sharply, resulting in a significantly higher free cash flow. The free cash flow margin increased compared with Q3, as capital expenditure also rose but at a smaller relative change.
Compared with the preceding quarter, free cash flow and free cash flow margin both improved substantially. Versus the same quarter one year earlier, free cash flow was slightly lower and the free cash flow margin weakened despite higher revenue.
Monitor operating cash flow stability, as it was significantly higher in the current and year-ago quarters versus the preceding quarter.