Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow remained negative but improved compared to the same quarter last year, driven by a smaller operating cash outflow and reduced capital spending. Revenue declined from the prior year but increased from the preceding quarter.
- Operating cash flow was negative, and after modest capital expenditure, free cash flow was also negative, resulting in a negative free cash flow margin. The conversion from revenue to cash was weak, as operating cash flow did not cover operating costs.
- Compared to the preceding quarter, revenue was higher, operating cash outflow was larger, capital expenditure was lower, and free cash flow was slightly more negative, but the free cash flow margin improved. Versus the same quarter one year earlier, revenue was lower, operating cash outflow was smaller, capital expenditure was significantly lower, and free cash flow was less negative, with a stronger free cash flow margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$208.5M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$48.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$46.2M
Cash generated by operations before capital spending.
CapEx
$1.8M
Capital spending and related asset purchases.
FCF margin
-47.0%
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 |
|---|---|---|---|---|---|
| 2022-10-01 | $82.5M | -$34.7M | $18.0M | -$52.6M | -63.8% |
| 2022-12-31 | $79.9M | -$49.9M | $10.5M | -$60.4M | -75.6% |
| 2023-04-01 | $92.2M | -$42.2M | $5.3M | -$47.5M | -51.5% |
| 2023-07-01 | $102.1M | -$46.2M | $1.8M | -$48.0M | -47.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 89.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$924.8M | 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
Operating cash flow was negative, though the outflow was smaller than the prior year. This is the strongest observable driver of free cash flow, as capital expenditure was relatively low.
The improvement in operating cash flow compared to last year reduced the free cash flow deficit.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was negative, and after modest capital expenditure, free cash flow was also negative, resulting in a negative free cash flow margin. The conversion from revenue to cash was weak, as operating cash flow did not cover operating costs.
Compared to the preceding quarter, revenue was higher, operating cash outflow was larger, capital expenditure was lower, and free cash flow was slightly more negative, but the free cash flow margin improved. Versus the same quarter one year earlier, revenue was lower, operating cash outflow was smaller, capital expenditure was significantly lower, and free cash flow was less negative, with a stronger free cash flow margin.
Monitor the trajectory of operating cash flow, as it remains negative and is the primary driver of free cash flow.