Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned positive this quarter after a negative prior quarter, but remained well below the year-ago level. The improvement was driven by higher operating cash flow and lower capital expenditure compared to the preceding quarter.
- Revenue was stable versus the year-ago quarter, yet operating cash flow was lower, resulting in a weaker free cash flow margin. Capital expenditure was slightly higher than a year ago, further compressing free cash flow.
- Compared to the prior quarter, revenue increased, operating cash flow improved, and capital expenditure decreased, turning free cash flow from negative to positive. Versus the same quarter last year, revenue was similar but operating cash flow was significantly lower, leading to a much lower free cash flow margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$220.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$29.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$59.0M
Cash generated by operations before capital spending.
CapEx
$30.0M
Capital spending and related asset purchases.
FCF margin
2.6%
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 |
|---|---|---|---|---|---|
| 2023-01-31 | $1.1B | $94.0M | $55.0M | $39.0M | 3.6% |
| 2023-04-30 | $1.0B | $230.0M | $67.0M | $163.0M | 15.6% |
| 2023-07-31 | $1.0B | $38.0M | $49.0M | -$11.0M | -1.1% |
| 2023-10-31 | $1.1B | $59.0M | $30.0M | $29.0M | 2.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 12.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.7% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$2.3B | 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 recovery
Operating cash flow increased from the prior quarter, reversing the negative free cash flow. This was the strongest observable driver of the quarter's cash conversion improvement.
Higher operating cash flow directly enabled positive free cash flow this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable versus the year-ago quarter, yet operating cash flow was lower, resulting in a weaker free cash flow margin. Capital expenditure was slightly higher than a year ago, further compressing free cash flow.
Compared to the prior quarter, revenue increased, operating cash flow improved, and capital expenditure decreased, turning free cash flow from negative to positive. Versus the same quarter last year, revenue was similar but operating cash flow was significantly lower, leading to a much lower free cash flow margin.
Monitor whether operating cash flow can sustain its improvement relative to the prior quarter, as it remains the primary constraint on free cash flow generation.