Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin improved compared to the same quarter last year but weakened relative to the immediately preceding quarter. The sequential decline in free cash flow was driven by a combination of lower revenue and reduced operating cash flow.
- Revenue decreased from the prior quarter, while operating cash flow also fell. Capital expenditure was lower, but the decline in operating cash flow outpaced the reduction in capex, resulting in lower free cash flow and a narrower margin compared to the prior quarter.
- Compared to the immediately preceding quarter, operating cash flow, free cash flow, and margin were all lower. Versus the same quarter one year earlier, revenue, operating cash flow, capital expenditure, free cash flow, and margin were all higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$31.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$6.2B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$10.6B
Cash generated by operations before capital spending.
CapEx
$4.4B
Capital spending and related asset purchases.
FCF margin
10.1%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $65.4B | $12.4B | $4.7B | $7.7B | 11.9% |
| 2023-09-30 | $65.2B | $13.7B | $5.3B | $8.4B | 12.8% |
| 2023-12-31 | $64.6B | $14.4B | $5.7B | $8.7B | 13.5% |
| 2024-03-31 | $61.3B | $10.6B | $4.4B | $6.2B | 10.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 48.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 7.2% | 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 Swing
Operating cash flow declined from the prior quarter, compressing free cash flow despite a reduction in capital expenditure. The quarter-over-quarter movement in operating cash flow outweighed the change in capex, making it the strongest observable driver of the free cash flow change.
The weakened cash conversion compared to the prior quarter indicates that operating cash flow was the key lever behind the free cash flow decline.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue decreased from the prior quarter, while operating cash flow also fell. Capital expenditure was lower, but the decline in operating cash flow outpaced the reduction in capex, resulting in lower free cash flow and a narrower margin compared to the prior quarter.
Compared to the immediately preceding quarter, operating cash flow, free cash flow, and margin were all lower. Versus the same quarter one year earlier, revenue, operating cash flow, capital expenditure, free cash flow, and margin were all higher.
Monitor the trajectory of operating cash flow, as its sequential decline was the primary factor behind the weakened free cash flow margin.