Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue increased while operating cash flow grew even more strongly, resulting in a higher free cash flow and an improved margin. Capital expenditure rose but remained a small share of operating cash flow, enhancing cash conversion.
- The company converted a larger portion of revenue into free cash flow compared to the prior quarter and the same quarter last year, driven by a substantial increase in operating cash flow relative to capital expenditure.
- Compared to the immediately preceding quarter, both revenue and operating cash flow were higher, and the free cash flow margin improved significantly. Versus the same quarter one year earlier, all metrics were higher, with the margin expanding.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$784.9M
Trailing twelve-month free cash flow.
Quarter free cash flow
$712.2M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$729.2M
Cash generated by operations before capital spending.
CapEx
$17.0M
Capital spending and related asset purchases.
FCF margin
38.7%
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 | $1.3B | -$204.5M | $5.5M | -$210.0M | -16.4% |
| 2022-12-31 | $1.3B | $123.1M | $10.4M | $112.7M | 8.7% |
| 2023-03-31 | $1.6B | $175.5M | $5.5M | $170.0M | 10.3% |
| 2023-06-30 | $1.8B | $729.2M | $17.0M | $712.2M | 38.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 219.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$3.2B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Strong Operating Cash Flow
Operating cash flow increased markedly compared to both the prior quarter and the year-ago quarter, outpacing revenue growth and capital expenditure increases.
This drove a substantial improvement in free cash flow and margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
The company converted a larger portion of revenue into free cash flow compared to the prior quarter and the same quarter last year, driven by a substantial increase in operating cash flow relative to capital expenditure.
Compared to the immediately preceding quarter, both revenue and operating cash flow were higher, and the free cash flow margin improved significantly. Versus the same quarter one year earlier, all metrics were higher, with the margin expanding.
Monitor the level of capital expenditure as it increased from both prior periods, which could affect future free cash flow if it continues to rise.