Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The company's free cash flow remained negative, but improved significantly compared to both the prior quarter and the same quarter a year earlier. Revenue increased while operating cash outflow narrowed, leading to a less negative free cash flow margin.
- Revenue increased, and operating cash flow, though still negative, was much closer to breakeven. Capital expenditure was higher than the prior quarter but lower than the year-ago quarter on a net basis, and the resulting free cash flow, while negative, showed a markedly improved free cash flow margin.
- Compared to the immediately preceding quarter, revenue was higher, operating cash flow less negative, capital expenditure lower, and free cash flow less negative. Versus the same quarter one year earlier, revenue was higher, operating cash flow far less negative, capital expenditure increased, and free cash flow much less negative.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$1.2M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$125018
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$45290
Cash generated by operations before capital spending.
CapEx
$79728
Capital spending and related asset purchases.
FCF margin
-24.5%
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 |
|---|---|---|---|---|---|
| 2023-02-28 | $156090 | $159744 | $469843 | -$310099 | -198.7% |
| 2023-05-31 | $142126 | $9135 | $261257 | -$252122 | -177.4% |
| 2023-08-31 | $245346 | -$366690 | $118812 | -$485502 | -197.9% |
| 2023-11-30 | $511308 | -$45290 | $79728 | -$125018 | -24.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 13.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 15.6% | 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 recovery
Operating cash outflow decreased sharply year-over-year, driven largely by increases in non-cash expenses as noted in the filing. The improvement brought operating cash flow close to breakeven, but it remains negative.
The reduced cash burn from operations is the strongest observable driver behind the narrower free cash flow deficit this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased, and operating cash flow, though still negative, was much closer to breakeven. Capital expenditure was higher than the prior quarter but lower than the year-ago quarter on a net basis, and the resulting free cash flow, while negative, showed a markedly improved free cash flow margin.
Compared to the immediately preceding quarter, revenue was higher, operating cash flow less negative, capital expenditure lower, and free cash flow less negative. Versus the same quarter one year earlier, revenue was higher, operating cash flow far less negative, capital expenditure increased, and free cash flow much less negative.
Monitor the trend in non-cash expenses such as depreciation and stock-based compensation, as they were cited as primary factors reducing the operating cash outflow.