Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was slightly lower than the prior quarter and the year-ago quarter, while free cash flow improved significantly versus both periods. Operating cash flow turned strongly positive compared to a negative year-ago figure, driving a substantial increase in free cash flow margin.
- Operating cash flow was substantially higher than capital expenditure, resulting in a free cash flow margin that was higher than the prior quarter and markedly improved from the negative year-ago margin. Revenue was stable relative to both comparison periods, so the cash conversion improvement was driven by stronger operating cash flow.
- Compared to the immediately preceding quarter, revenue was slightly lower but operating cash flow and free cash flow were higher, leading to an improved free cash flow margin. Versus the same quarter one year earlier, revenue was slightly lower while operating cash flow and free cash flow turned from negative to positive, resulting in a much higher free cash flow margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$607.3M
Trailing twelve-month free cash flow.
Quarter free cash flow
$249.5M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$266.1M
Cash generated by operations before capital spending.
CapEx
$16.6M
Capital spending and related asset purchases.
FCF margin
24.0%
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 |
|---|---|---|---|---|---|
| 2023-04-29 | $1.1B | $229.8M | $28.0M | $201.8M | 17.8% |
| 2023-07-29 | $1.1B | $8.7M | $25.4M | -$16.7M | -1.6% |
| 2023-10-28 | $1.1B | $195.5M | $22.8M | $172.7M | 15.3% |
| 2024-01-27 | $1.0B | $266.1M | $16.6M | $249.5M | 24.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 503.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.6% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$290.1M | 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 Strength
Operating cash flow was higher than both the prior quarter and the year-ago quarter, where it was negative. This was the primary factor behind the improvement in free cash flow and free cash flow margin.
The strong operating cash flow drove free cash flow to a higher level despite slightly lower revenue.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was substantially higher than capital expenditure, resulting in a free cash flow margin that was higher than the prior quarter and markedly improved from the negative year-ago margin. Revenue was stable relative to both comparison periods, so the cash conversion improvement was driven by stronger operating cash flow.
Compared to the immediately preceding quarter, revenue was slightly lower but operating cash flow and free cash flow were higher, leading to an improved free cash flow margin. Versus the same quarter one year earlier, revenue was slightly lower while operating cash flow and free cash flow turned from negative to positive, resulting in a much higher free cash flow margin.
Monitor whether operating cash flow can sustain its positive level relative to revenue, given the prior year's negative figure.