Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the current quarter, free cash flow was negative, as operating cash flow did not cover capital expenditure. Revenue was higher than the same quarter a year ago but lower than the previous quarter, while free cash flow improved year-over-year but weakened sequentially.
- The company converted revenue into negative free cash flow, with operating cash flow insufficient to cover capital expenditure, resulting in a negative free cash flow margin.
- Compared to the previous quarter, revenue, operating cash flow, and free cash flow all declined, and free cash flow shifted from positive to negative. Compared to the same quarter a year ago, revenue increased, while free cash flow improved from a larger negative to a smaller negative.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$928.2M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$66.7M
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$62.0M
Cash generated by operations before capital spending.
CapEx
$4.7M
Capital spending and related asset purchases.
FCF margin
-4.7%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $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% |
| 2023-09-30 | $1.4B | -$62.0M | $4.7M | -$66.7M | -4.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -73.4% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.3% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$3.4B | 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 variability
Operating cash flow was lower than the previous quarter but higher than the same quarter a year ago. This change directly drove the sequential weakening and year-over-year improvement in free cash flow.
The free cash flow margin turned from positive to negative sequentially, while improving year-over-year.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
The company converted revenue into negative free cash flow, with operating cash flow insufficient to cover capital expenditure, resulting in a negative free cash flow margin.
Compared to the previous quarter, revenue, operating cash flow, and free cash flow all declined, and free cash flow shifted from positive to negative. Compared to the same quarter a year ago, revenue increased, while free cash flow improved from a larger negative to a smaller negative.
Monitor the trend in operating cash flow, given its significant variability between the current quarter and the prior periods.