Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was stable while operating cash flow declined, leading to a lower free cash flow and margin. Capital expenditure was slightly higher than the prior quarter but increased compared to a year ago.
- With revenue unchanged, the decrease in operating cash flow reduced free cash flow, as capital expenditure remained elevated relative to both prior periods.
- Compared to the immediately preceding quarter, operating cash flow and free cash flow were lower, and the margin weakened. Versus the same quarter one year earlier, operating cash flow was slightly lower, capital expenditure was higher, and free cash flow decreased with a lower margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.9B
Trailing twelve-month free cash flow.
Quarter free cash flow
$421.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$3.2B
Cash generated by operations before capital spending.
CapEx
$2.8B
Capital spending and related asset purchases.
FCF margin
3.1%
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 | $13.7B | $3.3B | $2.8B | $477.0M | 3.5% |
| 2023-09-30 | $13.6B | $3.9B | $3.0B | $983.0M | 7.2% |
| 2023-12-31 | $13.7B | $3.9B | $2.9B | $999.0M | 7.3% |
| 2024-03-31 | $13.7B | $3.2B | $2.8B | $421.0M | 3.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 32.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 20.4% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$97.3B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Capital Expenditure Pressure
Capital expenditure was higher than the year-ago quarter, operating cash flow was slightly lower, and free cash flow declined meaningfully. The increased outlay for capital items appears to be the strongest observable factor holding back free cash flow.
Higher capital expenditure relative to operating cash flow substantially reduced free cash flow and margin this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
With revenue unchanged, the decrease in operating cash flow reduced free cash flow, as capital expenditure remained elevated relative to both prior periods.
Compared to the immediately preceding quarter, operating cash flow and free cash flow were lower, and the margin weakened. Versus the same quarter one year earlier, operating cash flow was slightly lower, capital expenditure was higher, and free cash flow decreased with a lower margin.
Monitor capital expenditure levels, as they remained higher than a year ago and pressured free cash flow despite stable revenue.