Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue held roughly stable while operating cash flow remained unchanged. A decrease in capital expenditure improved free cash flow and its margin compared to both the prior quarter and the same quarter last year.
- Operating cash flow as a share of revenue was consistent across all periods, but lower capital expenditure allowed a higher portion of operating cash flow to convert into free cash flow, lifting the free cash flow margin.
- Compared to the immediately preceding quarter, free cash flow and its margin improved as capital expenditure fell while revenue and operating cash flow were broadly stable. Versus the same quarter one year earlier, the same pattern of lower capital expenditure drove a higher free cash flow and margin despite similar revenue and operating cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.3B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$3.9B
Cash generated by operations before capital spending.
CapEx
$2.6B
Capital spending and related asset purchases.
FCF margin
9.7%
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 | $13.7B | $3.9B | $2.9B | $999.0M | 7.3% |
| 2024-03-31 | $13.7B | $3.2B | $2.8B | $421.0M | 3.1% |
| 2024-06-30 | $13.7B | $3.9B | $2.9B | $1.0B | 7.3% |
| 2024-09-30 | $13.8B | $3.9B | $2.6B | $1.3B | 9.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 104.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 18.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$94.6B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Lower capital expenditure
Capital expenditure decreased from both the prior quarter and the year-ago quarter, while revenue and operating cash flow remained essentially flat. This reduction directly increased free cash flow and its margin.
The lower capital expenditure was the strongest observable driver of the improved free cash flow margin this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a share of revenue was consistent across all periods, but lower capital expenditure allowed a higher portion of operating cash flow to convert into free cash flow, lifting the free cash flow margin.
Compared to the immediately preceding quarter, free cash flow and its margin improved as capital expenditure fell while revenue and operating cash flow were broadly stable. Versus the same quarter one year earlier, the same pattern of lower capital expenditure drove a higher free cash flow and margin despite similar revenue and operating cash flow.
Monitor the trend in capital expenditure, as its reduction was the key factor behind the free cash flow improvement in the current quarter.