Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue rose sequentially, operating cash flow and free cash flow were higher than the prior quarter, and free cash flow margin improved. Compared with the same quarter last year, revenue was higher while operating cash flow and free cash flow were lower, resulting in a weakened free cash flow margin.
- Operating cash flow exceeded capital expenditure by a wide margin, producing free cash flow that closely tracked operating cash flow. The free cash flow margin reflected the proportion of revenue converted, with the level of operating cash flow dominating the conversion efficiency.
- Relative to the prior quarter, revenue, operating cash flow, and free cash flow were all higher, and the free cash flow margin strengthened. Versus the same quarter one year earlier, revenue was higher but operating cash flow and free cash flow were lower, leading to a weakened free cash flow margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.7B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.7B
Cash generated by operations before capital spending.
CapEx
$60.7M
Capital spending and related asset purchases.
FCF margin
59.2%
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 | $1.1B | $982.9M | $85.4M | $897.5M | 84.8% |
| 2022-12-31 | $1.7B | $715.1M | $48.7M | $666.4M | 39.1% |
| 2023-03-31 | $1.4B | $352.7M | $69.6M | $283.2M | 20.5% |
| 2023-06-30 | $2.8B | $1.7B | $60.7M | $1.7B | 59.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 276.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$9.2B | 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 up sequentially
Operating cash flow was higher than the prior quarter, driving free cash flow higher despite a small capital expenditure amount. The sequential improvement in operating cash flow was the most prominent factor in the current quarter's cash generation.
The higher operating cash flow led to a strengthened free cash flow margin compared to the prior quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow exceeded capital expenditure by a wide margin, producing free cash flow that closely tracked operating cash flow. The free cash flow margin reflected the proportion of revenue converted, with the level of operating cash flow dominating the conversion efficiency.
Relative to the prior quarter, revenue, operating cash flow, and free cash flow were all higher, and the free cash flow margin strengthened. Versus the same quarter one year earlier, revenue was higher but operating cash flow and free cash flow were lower, leading to a weakened free cash flow margin.
Monitor the relationship between revenue and operating cash flow, as the current quarter showed improved conversion versus the prior quarter but a decline versus the prior year.