Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin weakened compared to both the prior quarter and the same quarter last year. Operating cash flow was lower period over period, while capital expenditure remained stable.
- Revenue was slightly lower quarter over quarter, and operating cash flow decreased at a faster pace, leading to a lower free cash flow margin. Capital expenditure was relatively stable across all periods.
- Compared to the prior quarter, revenue was slightly lower, operating cash flow was significantly lower, and free cash flow margin weakened. Versus the same quarter one year ago, revenue was lower, operating cash flow was lower, and free cash flow margin was also lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$10.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.6B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.9B
Cash generated by operations before capital spending.
CapEx
$259.0M
Capital spending and related asset purchases.
FCF margin
14.5%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $11.2B | $3.7B | $247.0M | $3.4B | 30.7% |
| 2022-12-31 | $11.4B | $3.3B | $346.0M | $3.0B | 26.0% |
| 2023-03-31 | $11.3B | $3.0B | $278.0M | $2.7B | 23.7% |
| 2023-06-30 | $11.2B | $1.9B | $259.0M | $1.6B | 14.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 78.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.3% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$28.7B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Weaker Operating Cash Flow
Operating cash flow was substantially lower than both the prior quarter and the year-ago quarter, despite capital expenditure remaining broadly similar. This was the primary factor behind the reduced free cash flow and margin.
The lower operating cash flow directly compressed free cash flow and margin in the current quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was slightly lower quarter over quarter, and operating cash flow decreased at a faster pace, leading to a lower free cash flow margin. Capital expenditure was relatively stable across all periods.
Compared to the prior quarter, revenue was slightly lower, operating cash flow was significantly lower, and free cash flow margin weakened. Versus the same quarter one year ago, revenue was lower, operating cash flow was lower, and free cash flow margin was also lower.
Monitor the trend in operating cash flow conversion relative to revenue, as it declined notably this quarter.