Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved sequentially as operating cash flow rose more than capital expenditure. Compared to the same quarter last year, free cash flow was lower despite higher revenue, reflecting a weaker cash conversion margin.
- Revenue increased while operating cash flow grew, leading to higher free cash flow and a slightly improved free cash flow margin versus the prior quarter. The margin remained below the year-ago level, indicating a lower rate of revenue conversion into free cash flow.
- Compared to the prior quarter, free cash flow and margin were higher, driven by stronger operating cash flow. Versus the same quarter last year, free cash flow and margin were lower, even though revenue was higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$576.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$932.0M
Cash generated by operations before capital spending.
CapEx
$356.0M
Capital spending and related asset purchases.
FCF margin
8.4%
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 | $5.7B | $461.0M | $310.0M | $151.0M | 2.6% |
| 2023-06-30 | $6.3B | $859.0M | $277.0M | $582.0M | 9.2% |
| 2023-09-30 | $6.6B | $810.0M | $281.0M | $529.0M | 8.0% |
| 2023-12-31 | $6.8B | $932.0M | $356.0M | $576.0M | 8.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 130.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.2% | 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 Growth
Operating cash flow rose from the prior quarter, outpacing the increase in capital expenditure and driving free cash flow higher. This was the strongest observable factor in the sequential improvement.
Higher operating cash flow directly improved free cash flow and margin compared to the prior quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased while operating cash flow grew, leading to higher free cash flow and a slightly improved free cash flow margin versus the prior quarter. The margin remained below the year-ago level, indicating a lower rate of revenue conversion into free cash flow.
Compared to the prior quarter, free cash flow and margin were higher, driven by stronger operating cash flow. Versus the same quarter last year, free cash flow and margin were lower, even though revenue was higher.
Monitor the trend in capital expenditure relative to operating cash flow, as it increased sequentially and year-over-year.