Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin improved substantially compared to the prior quarter and the same quarter last year, driven by higher operating cash flow relative to revenue. The company's business model, which generates revenue primarily from management fees, supports strong cash conversion with minimal capital expenditure.
- Operating cash flow was higher than both the prior quarter and the same quarter last year, while capital expenditure remained minimal. This resulted in free cash flow representing a large portion of revenue, reflecting the low capital intensity of the business as described in the filing.
- Compared to the prior quarter, revenue was lower but operating cash flow and free cash flow were higher, leading to a much stronger free cash flow margin. Compared to the same quarter last year, all metrics improved, and the free cash flow margin increased substantially.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$4.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.1B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.2B
Cash generated by operations before capital spending.
CapEx
$12.4M
Capital spending and related asset purchases.
FCF margin
41.0%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $2.5B | $1.1B | $62.7M | $1.0B | 40.1% |
| 2023-12-31 | $1.3B | $895.7M | $31.3M | $864.4M | 67.3% |
| 2024-03-31 | $3.7B | $939.8M | $17.8M | $922.1M | 25.0% |
| 2024-06-30 | $2.8B | $1.2B | $12.4M | $1.1B | 41.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 257.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.4% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$8.4B | 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 Generation
Operating cash flow increased significantly from both the prior quarter and the year-ago quarter, while capital expenditure remained very low. This resulted in a free cash flow margin that was much higher than in the comparable periods.
The enhanced cash conversion provides the company with ample internal funds for growth initiatives and distributions, as noted in the liquidity discussion.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was higher than both the prior quarter and the same quarter last year, while capital expenditure remained minimal. This resulted in free cash flow representing a large portion of revenue, reflecting the low capital intensity of the business as described in the filing.
Compared to the prior quarter, revenue was lower but operating cash flow and free cash flow were higher, leading to a much stronger free cash flow margin. Compared to the same quarter last year, all metrics improved, and the free cash flow margin increased substantially.
Monitor the trend in assets under management, as management fees are earned as a percentage of such metrics according to the filing.