Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue rose compared to both the prior quarter and the same quarter a year ago, yet operating cash flow fell sharply, pushing free cash flow into negative territory. The free cash flow margin turned negative, indicating a notable weakening in cash conversion.
- Despite higher revenue, operating cash flow was much lower than both the preceding quarter and the year-ago quarter, while capital expenditure was lower than the preceding quarter but higher than the year-ago quarter. The combination resulted in negative free cash flow and a negative free cash flow margin.
- Compared to the preceding quarter, revenue was higher but operating cash flow and free cash flow were substantially lower, with the margin weakening from positive to negative. Versus the same quarter a year earlier, revenue was higher while operating cash flow and free cash flow were lower, and the margin also weakened.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$62.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$40.0M
Cash generated by operations before capital spending.
CapEx
$102.0M
Capital spending and related asset purchases.
FCF margin
-1.1%
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 | $6.7B | $384.0M | $74.0M | $310.0M | 4.6% |
| 2023-09-30 | $3.4B | $1.0B | $73.0M | $968.0M | 28.7% |
| 2023-12-31 | $4.3B | $1.1B | $222.0M | $840.0M | 19.5% |
| 2024-03-31 | $5.4B | $40.0M | $102.0M | -$62.0M | -1.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -21.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$15.7B | 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 Decline
Revenue increased compared to both prior periods, but operating cash flow dropped significantly, leading to negative free cash flow and a negative margin. This divergence is the most notable change in the quarter.
The company's ability to convert revenue growth into positive free cash flow has weakened and requires close observation.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Despite higher revenue, operating cash flow was much lower than both the preceding quarter and the year-ago quarter, while capital expenditure was lower than the preceding quarter but higher than the year-ago quarter. The combination resulted in negative free cash flow and a negative free cash flow margin.
Compared to the preceding quarter, revenue was higher but operating cash flow and free cash flow were substantially lower, with the margin weakening from positive to negative. Versus the same quarter a year earlier, revenue was higher while operating cash flow and free cash flow were lower, and the margin also weakened.
Monitor the trend of operating cash flow relative to revenue, as it directly drives free cash flow generation.