Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue, operating cash flow, capital expenditure, free cash flow, and free cash flow margin all improved. Free cash flow turned positive from a negative position in the prior quarter and from a negative position one year earlier.
- Operating cash flow as a proportion of revenue strengthened, rising from negative to positive, and capital expenditure was lower sequentially. Free cash flow margin moved from negative to positive, reflecting improved cash conversion.
- Compared with the immediately preceding quarter, free cash flow and free cash flow margin both improved, driven by higher operating cash flow and lower capital expenditure. Versus the same quarter one year earlier, free cash flow also improved, as operating cash flow was higher and capital expenditure was broadly similar.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$7.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.6B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.9B
Cash generated by operations before capital spending.
CapEx
$296.0M
Capital spending and related asset purchases.
FCF margin
13.1%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $16.0B | $3.2B | $284.0M | $2.9B | 18.2% |
| 2022-12-31 | $20.0B | $3.5B | $326.0M | $3.1B | 15.7% |
| 2023-03-31 | $17.9B | -$318.0M | $468.0M | -$786.0M | -4.4% |
| 2023-06-30 | $19.8B | $2.9B | $296.0M | $2.6B | 13.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -1730.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.5% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$44.8B | 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 from negative to positive relative to the prior quarter, and from substantially lower to higher versus the year-ago quarter. This was the strongest observable driver of free cash flow improvement.
The increase in operating cash flow directly enabled free cash flow to turn positive this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a proportion of revenue strengthened, rising from negative to positive, and capital expenditure was lower sequentially. Free cash flow margin moved from negative to positive, reflecting improved cash conversion.
Compared with the immediately preceding quarter, free cash flow and free cash flow margin both improved, driven by higher operating cash flow and lower capital expenditure. Versus the same quarter one year earlier, free cash flow also improved, as operating cash flow was higher and capital expenditure was broadly similar.
Monitor the trajectory of operating cash flow, which was the main factor in the shift to positive free cash flow.