Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The company generated positive free cash flow for the quarter, a significant improvement from the prior quarter's negative cash flow. However, both revenue and free cash flow were lower compared to the same quarter last year.
- Revenue was higher than the previous quarter, and operating cash flow turned positive, resulting in free cash flow that was also positive. Capital expenditure remained low, and the free cash flow margin improved from negative to positive.
- Compared to the immediately preceding quarter, all cash flow metrics improved markedly, with operating cash flow moving from negative to positive. Relative to the same quarter one year earlier, revenue and free cash flow were lower, and the free cash flow margin weakened.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$63.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$44.4M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$47.4M
Cash generated by operations before capital spending.
CapEx
$3.1M
Capital spending and related asset purchases.
FCF margin
7.9%
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 |
|---|---|---|---|---|---|
| 2024-01-27 | $415.4M | -$35.8M | $3.3M | -$39.0M | -9.4% |
| 2024-04-27 | $235.9M | $81.7M | $2.6M | $79.1M | 33.5% |
| 2024-07-27 | $250.9M | -$143.5M | $4.0M | -$147.5M | -58.8% |
| 2024-10-26 | $559.7M | $47.4M | $3.1M | $44.4M | 7.9% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 102.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.5% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$165.9M | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Sequential Revenue Increase
Revenue rose sharply from the prior quarter, which was the most substantial observable change. This increase coincided with operating cash flow turning positive and free cash flow flipping from negative to positive.
The higher revenue was the primary factor behind the improvement in cash generation from the preceding quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than the previous quarter, and operating cash flow turned positive, resulting in free cash flow that was also positive. Capital expenditure remained low, and the free cash flow margin improved from negative to positive.
Compared to the immediately preceding quarter, all cash flow metrics improved markedly, with operating cash flow moving from negative to positive. Relative to the same quarter one year earlier, revenue and free cash flow were lower, and the free cash flow margin weakened.
Monitor whether the free cash flow margin can sustain its positive level in future quarters, given it was lower than the prior year's same quarter.