Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
The company's free cash flow margin improved slightly from the same quarter last year, reflecting higher operating cash flow relative to revenue. However, compared to the prior quarter, both revenue and free cash flow declined, compressing the margin.
- Revenue increased year-over-year, and operating cash flow grew accordingly, leading to higher free cash flow and a marginally improved free cash flow margin. Capital expenditure remained low, so free cash flow closely tracked operating cash flow.
- Free cash flow decreased from the prior quarter, as revenue and operating cash flow both fell, and the free cash flow margin weakened. Compared to the same quarter a year ago, free cash flow increased, with revenue and operating cash flow both higher, and the margin improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$346.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$353.0M
Cash generated by operations before capital spending.
CapEx
$7.0M
Capital spending and related asset purchases.
FCF margin
11.8%
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 | $2.6B | $575.0M | $4.0M | $571.0M | 21.9% |
| 2023-09-30 | $1.8B | $650.0M | $2.0M | $648.0M | 35.8% |
| 2023-12-31 | $3.4B | $577.0M | $8.0M | $569.0M | 17.0% |
| 2024-03-31 | $2.9B | $353.0M | $7.0M | $346.0M | 11.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 45.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 0.2% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$171.0M | 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 Variability
Operating cash flow decreased from the prior quarter, driving the decline in free cash flow and margin. Year-over-year, operating cash flow improved, supporting higher free cash flow and a slightly stronger margin.
The sequential decline in operating cash flow was the primary factor behind the reduction in free cash flow and margin in the current quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased year-over-year, and operating cash flow grew accordingly, leading to higher free cash flow and a marginally improved free cash flow margin. Capital expenditure remained low, so free cash flow closely tracked operating cash flow.
Free cash flow decreased from the prior quarter, as revenue and operating cash flow both fell, and the free cash flow margin weakened. Compared to the same quarter a year ago, free cash flow increased, with revenue and operating cash flow both higher, and the margin improved.
Monitor the trend of operating cash flow, as it directly influences free cash flow given the relatively stable capital expenditure.