Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and free cash flow were lower than both the prior quarter and the same quarter last year. Operating cash flow declined while capital expenditure increased compared to the year-ago period.
- Cash conversion weakened as operating cash flow fell relative to revenue, and free cash flow margin narrowed compared to both the preceding quarter and the year-ago quarter.
- Compared to the prior quarter, revenue was higher but operating cash flow and free cash flow were lower, resulting in a weaker free cash flow margin. Versus the same quarter last year, all metrics were lower except capital expenditure, which was higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$265.9M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$391.3M
Cash generated by operations before capital spending.
CapEx
$125.5M
Capital spending and related asset purchases.
FCF margin
5.9%
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 | $5.8B | $1.5B | $85.7M | $1.4B | 24.6% |
| 2022-12-31 | $4.4B | $971.4M | $134.9M | $836.5M | 19.2% |
| 2023-03-31 | $3.9B | $654.4M | $105.6M | $548.7M | 14.1% |
| 2023-06-30 | $4.5B | $391.3M | $125.5M | $265.9M | 5.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 65.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.8% | 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 Decline
Operating cash flow was lower than both the prior quarter and the year-ago quarter, even as revenue improved sequentially. This drove the reduction in free cash flow and margin.
The lower operating cash flow was the primary factor behind the weakened free cash flow generation this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Cash conversion weakened as operating cash flow fell relative to revenue, and free cash flow margin narrowed compared to both the preceding quarter and the year-ago quarter.
Compared to the prior quarter, revenue was higher but operating cash flow and free cash flow were lower, resulting in a weaker free cash flow margin. Versus the same quarter last year, all metrics were lower except capital expenditure, which was higher.
Monitor the trend in operating cash flow relative to revenue, as it declined despite higher revenue compared to the prior quarter.