Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow was negative and weakened compared to both the prior quarter and the same quarter last year, driven by a larger operating cash outflow. The free cash flow margin also declined, reflecting a lower conversion of revenue into free cash.
- Revenue was slightly lower than the prior quarter but higher than a year ago, yet operating cash flow turned more negative, resulting in a larger free cash outflow. Capital expenditure increased from both comparison periods, further weighing on free cash flow and margin.
- Compared to the prior quarter, revenue was lower, operating cash flow was more negative, capital expenditure was higher, and free cash flow was more negative with a weakened margin. Versus the same quarter last year, revenue was higher, operating cash flow was more negative, capital expenditure was higher, and free cash flow was more negative with a weakened margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
-$7.7B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$3.9B
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$3.2B
Cash generated by operations before capital spending.
CapEx
$687.0M
Capital spending and related asset purchases.
FCF margin
-77.4%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $5.8B | -$934.0M | $660.0M | -$1.6B | -27.3% |
| 2023-06-30 | $4.7B | -$192.0M | $676.0M | -$868.0M | -18.5% |
| 2023-09-30 | $5.3B | -$993.0M | $399.0M | -$1.4B | -26.2% |
| 2023-12-31 | $5.0B | -$3.2B | $687.0M | -$3.9B | -77.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 10456.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 13.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$7.3B | 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 Outflow
Operating cash flow turned substantially more negative compared to both the prior quarter and the same quarter last year, despite revenue being higher year over year. This was the strongest observable driver of the free cash flow deterioration.
The larger operating cash outflow overwhelmed the revenue increase and higher capital spending, leading to a more negative free cash flow and a lower margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was slightly lower than the prior quarter but higher than a year ago, yet operating cash flow turned more negative, resulting in a larger free cash outflow. Capital expenditure increased from both comparison periods, further weighing on free cash flow and margin.
Compared to the prior quarter, revenue was lower, operating cash flow was more negative, capital expenditure was higher, and free cash flow was more negative with a weakened margin. Versus the same quarter last year, revenue was higher, operating cash flow was more negative, capital expenditure was higher, and free cash flow was more negative with a weakened margin.
Monitor the magnitude of operating cash outflow, as it was the primary factor behind the free cash flow decline.