Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue, operating cash flow, and free cash flow all turned positive for the current quarter. Free cash flow margin improved significantly from negative levels in both the prior quarter and the same quarter a year ago.
- The company converted a substantial portion of its revenue into operating cash flow, resulting in a free cash flow margin that was positive and markedly higher than in the two preceding comparable periods.
- Compared with the immediately preceding quarter, revenue was higher and operating cash flow reversed from a large outflow to a large inflow. Free cash flow also flipped from negative to positive. Versus the same quarter one year ago, all key metrics improved, with revenue higher and both operating cash flow and free cash flow moving from negative to positive.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$62.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
$14.1B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$15.8B
Cash generated by operations before capital spending.
CapEx
$1.7B
Capital spending and related asset purchases.
FCF margin
70.0%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $18.0B | $12.8B | $2.0B | $10.8B | 60.2% |
| 2023-03-31 | $21.4B | -$30.5B | $1.6B | -$32.1B | -149.8% |
| 2023-06-30 | $19.4B | -$54.1B | $1.5B | -$55.5B | -285.8% |
| 2023-09-30 | $20.1B | $15.8B | $1.7B | $14.1B | 70.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 397.7% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 8.4% | 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.
Cash Flow Turnaround
The strongest observable driver is the shift in operating cash flow from a large negative amount in the prior quarter to a large positive amount in the current quarter. This was accompanied by a higher capital expenditure and a substantial improvement in free cash flow.
This turnaround elevated free cash flow margin from deeply negative to strongly positive, marking a material change in cash generation.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
The company converted a substantial portion of its revenue into operating cash flow, resulting in a free cash flow margin that was positive and markedly higher than in the two preceding comparable periods.
Compared with the immediately preceding quarter, revenue was higher and operating cash flow reversed from a large outflow to a large inflow. Free cash flow also flipped from negative to positive. Versus the same quarter one year ago, all key metrics improved, with revenue higher and both operating cash flow and free cash flow moving from negative to positive.
Monitor whether operating cash flow and free cash flow remain positive in future quarters, given that the current quarter's cash conversion represents a sharp reversal from negative levels in the prior two periods.