Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow was lower than the prior quarter and significantly lower than the same quarter last year, driven by a decline in operating cash flow. The free cash flow margin weakened sequentially and year-over-year.
- Revenue decreased slightly from the prior quarter and more notably from a year ago, while operating cash flow fell sharply in both comparisons. Capital expenditure remained relatively stable, so the decline in free cash flow was driven by lower cash generation from operations, resulting in a much lower free cash flow margin.
- Compared to the immediately preceding quarter, revenue was slightly lower and operating cash flow was substantially lower, leading to a weakened free cash flow margin. Versus the same quarter one year earlier, revenue was lower and operating cash flow was significantly lower, with free cash flow margin declining sharply.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$702.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
$43.2M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$47.3M
Cash generated by operations before capital spending.
CapEx
$4.1M
Capital spending and related asset purchases.
FCF margin
1.0%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $4.6B | $254.5M | $11.4M | $243.2M | 5.3% |
| 2023-06-30 | $4.4B | $224.8M | $10.3M | $214.5M | 4.9% |
| 2023-09-30 | $4.3B | $205.2M | $4.2M | $201.0M | 4.6% |
| 2023-12-31 | $4.2B | $47.3M | $4.1M | $43.2M | 1.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 139.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.1% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$1.4B | 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
Operating cash flow was lower than both the prior quarter and the same quarter last year, while revenue also declined. This was the strongest observable driver of the reduction in free cash flow.
The lower operating cash flow directly reduced free cash flow and compressed the free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue decreased slightly from the prior quarter and more notably from a year ago, while operating cash flow fell sharply in both comparisons. Capital expenditure remained relatively stable, so the decline in free cash flow was driven by lower cash generation from operations, resulting in a much lower free cash flow margin.
Compared to the immediately preceding quarter, revenue was slightly lower and operating cash flow was substantially lower, leading to a weakened free cash flow margin. Versus the same quarter one year earlier, revenue was lower and operating cash flow was significantly lower, with free cash flow margin declining sharply.
Monitor operating cash flow trends, as the sequential and year-over-year declines were the primary factor behind the weakened free cash flow.