Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was stable compared to the prior quarter but lower than the same quarter a year ago. Operating cash flow and free cash flow improved sequentially but remained below the year-ago level, resulting in a mixed cash conversion performance.
- Revenue generated supported operating cash flow, which after capital expenditure yielded free cash flow and a free cash flow margin. The margin improved from the prior quarter but weakened compared to the year-ago quarter.
- Compared to the preceding quarter, free cash flow margin was higher due to a larger increase in operating cash flow relative to revenue and stable capital expenditure. Compared to the same quarter one year earlier, free cash flow margin was lower as operating cash flow declined more than revenue.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$308.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$342.1M
Cash generated by operations before capital spending.
CapEx
$33.6M
Capital spending and related asset purchases.
FCF margin
5.6%
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 |
|---|---|---|---|---|---|
| 2023-12-31 | $5.0B | $536.5M | $33.5M | $503.0M | 10.0% |
| 2024-03-31 | $4.9B | $440.0M | $29.5M | $410.5M | 8.4% |
| 2024-06-30 | $5.4B | $149.9M | $30.9M | $119.0M | 2.2% |
| 2024-09-30 | $5.5B | $342.1M | $33.6M | $308.5M | 5.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 97.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$5.1B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Sequential cash flow improvement
Operating cash flow was higher than the prior quarter, while revenue was only slightly higher, leading to a stronger conversion. Capital expenditure remained broadly stable, allowing the higher operating cash flow to translate into a higher free cash flow margin.
The sequential improvement in free cash flow margin partially offset the year-over-year decline, but free cash flow remained below the level of a year ago.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue generated supported operating cash flow, which after capital expenditure yielded free cash flow and a free cash flow margin. The margin improved from the prior quarter but weakened compared to the year-ago quarter.
Compared to the preceding quarter, free cash flow margin was higher due to a larger increase in operating cash flow relative to revenue and stable capital expenditure. Compared to the same quarter one year earlier, free cash flow margin was lower as operating cash flow declined more than revenue.
Monitor the trend in accounts receivable and the associated allowance for credit losses, as these items can affect future operating cash flow.