Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow and operating cash flow declined in the current quarter compared to both the preceding quarter and the same quarter one year earlier, despite a modest increase in revenue. The free cash flow margin weakened accordingly.
- Revenue was higher than the prior quarter and the year-ago quarter, but operating cash flow was lower, leading to a lower free cash flow. Capital expenditure remained relatively stable, so the decline in operating cash flow was the primary factor in the weaker cash conversion.
- Compared to the preceding quarter, operating cash flow and free cash flow were significantly lower, while revenue was slightly higher. Versus the same quarter last year, both operating cash flow and free cash flow were lower, and the free cash flow margin declined.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$264.4M
Trailing twelve-month free cash flow.
Quarter free cash flow
$103.3M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$108.1M
Cash generated by operations before capital spending.
CapEx
$4.7M
Capital spending and related asset purchases.
FCF margin
2.2%
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 | $4.2B | $47.3M | $4.1M | $43.2M | 1.0% |
| 2024-03-31 | $4.4B | -$33.3M | $8.6M | -$41.9M | -1.0% |
| 2024-06-30 | $4.5B | $166.4M | $6.6M | $159.8M | 3.6% |
| 2024-09-30 | $4.6B | $108.1M | $4.7M | $103.3M | 2.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 106.3% | 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.
Decline in Operating Cash Flow
Operating cash flow was lower compared to both the preceding quarter and the same quarter one year earlier, more than offsetting the slight revenue increase.
This drove the decrease in free cash flow and the weakening of the free cash flow margin for the quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than the prior quarter and the year-ago quarter, but operating cash flow was lower, leading to a lower free cash flow. Capital expenditure remained relatively stable, so the decline in operating cash flow was the primary factor in the weaker cash conversion.
Compared to the preceding quarter, operating cash flow and free cash flow were significantly lower, while revenue was slightly higher. Versus the same quarter last year, both operating cash flow and free cash flow were lower, and the free cash flow margin declined.
Monitor the trend in receivables and contract assets, as they are significant components of operating cash flow and have increased in the current period according to the balance sheet.