Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved sequentially and year over year, driven by higher operating cash flow. The free cash flow margin reached a level above both the prior quarter and the same quarter a year ago.
- Revenue was lower than the prior quarter but higher than a year ago. Operating cash flow rose significantly versus both periods, while capital expenditure was stable. The combination produced a higher free cash flow and an improved free cash flow margin.
- Compared to the prior quarter, revenue was lower but operating cash flow, free cash flow, and margin were all higher. Year over year, revenue, operating cash flow, free cash flow, and margin were all higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$7.4B
Trailing twelve-month free cash flow.
Quarter free cash flow
$2.8B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$2.9B
Cash generated by operations before capital spending.
CapEx
$88.0M
Capital spending and related asset purchases.
FCF margin
74.1%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $4.3B | $2.7B | $86.0M | $2.6B | 60.5% |
| 2022-09-30 | $6.1B | $2.0M | $98.0M | -$96.0M | -1.6% |
| 2022-12-31 | $4.0B | $2.2B | $75.0M | $2.1B | 51.8% |
| 2023-03-31 | $3.8B | $2.9B | $88.0M | $2.8B | 74.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | n/a | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.3% | Lower capital intensity usually supports FCF margin. |
| Net cash | $2.0B | 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 meaningfully compared to both the prior quarter and the year-ago quarter, while capital expenditure remained within a similar range. This was the primary observable factor behind the higher free cash flow and margin.
Free cash flow margin improved as operating cash flow outpaced revenue changes.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than the prior quarter but higher than a year ago. Operating cash flow rose significantly versus both periods, while capital expenditure was stable. The combination produced a higher free cash flow and an improved free cash flow margin.
Compared to the prior quarter, revenue was lower but operating cash flow, free cash flow, and margin were all higher. Year over year, revenue, operating cash flow, free cash flow, and margin were all higher.
Monitor the trajectory of operating cash flow relative to revenue in subsequent quarters, as it drove the margin improvement.