Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow weakened sharply in the fourth quarter as operating cash flow declined while capital expenditure remained stable. The free cash flow margin contracted compared to both the prior quarter and the same quarter last year.
- Revenue decreased from the prior quarter, and operating cash flow fell more than proportionally, resulting in a lower free cash flow margin. Capital expenditure was nearly unchanged, so the decline in free cash flow was driven entirely by lower cash generation from operations.
- Compared to the immediately preceding quarter, revenue, operating cash flow, free cash flow, and free cash flow margin all decreased. Versus the same quarter one year earlier, revenue was lower, operating cash flow was lower, free cash flow was lower, and the free cash flow margin was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$273.8M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$373.5M
Cash generated by operations before capital spending.
CapEx
$99.7M
Capital spending and related asset purchases.
FCF margin
7.2%
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 |
|---|---|---|---|---|---|
| 2024-03-31 | $3.9B | $317.2M | $93.2M | $224.0M | 5.8% |
| 2024-06-30 | $4.5B | $452.1M | $88.1M | $364.0M | 8.2% |
| 2024-09-30 | $4.2B | $730.0M | $99.6M | $630.4M | 14.9% |
| 2024-12-31 | $3.8B | $373.5M | $99.7M | $273.8M | 7.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 143.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.6% | 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 fell from the prior quarter and from the year-ago quarter, while capital expenditure remained essentially flat. This made operating cash flow the strongest observable driver of the lower free cash flow.
The entire reduction in free cash flow was attributable to weaker cash conversion from operations.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue decreased from the prior quarter, and operating cash flow fell more than proportionally, resulting in a lower free cash flow margin. Capital expenditure was nearly unchanged, so the decline in free cash flow was driven entirely by lower cash generation from operations.
Compared to the immediately preceding quarter, revenue, operating cash flow, free cash flow, and free cash flow margin all decreased. Versus the same quarter one year earlier, revenue was lower, operating cash flow was lower, free cash flow was lower, and the free cash flow margin was lower.
Monitor whether operating cash flow can stabilize or improve in the coming quarter, as it was the sole driver of the free cash flow decline.