Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved sequentially as operating cash flow rose more than capital expenditure, though it remained lower than the same quarter last year. The free cash flow margin strengthened from the prior quarter but weakened compared to the year-ago period.
- Revenue increased from both the prior quarter and the year-ago quarter. Operating cash flow rose sequentially but fell year over year, while capital expenditure decreased compared to both periods. The resulting free cash flow was higher than the previous quarter but lower than the same quarter one year earlier, and the free cash flow margin followed the same pattern.
- Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all higher, with capital expenditure slightly higher. Versus the same quarter one year earlier, revenue was higher but operating cash flow and free cash flow were lower, while capital expenditure was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$13.9B
Trailing twelve-month free cash flow.
Quarter free cash flow
$4.1B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$7.0B
Cash generated by operations before capital spending.
CapEx
$2.9B
Capital spending and related asset purchases.
FCF margin
12.8%
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 |
|---|---|---|---|---|---|
| 2023-12-31 | $31.3B | $5.9B | $3.3B | $2.6B | 8.3% |
| 2024-03-31 | $30.1B | $7.8B | $2.6B | $5.2B | 17.4% |
| 2024-06-30 | $29.7B | $4.7B | $2.7B | $2.0B | 6.7% |
| 2024-09-30 | $32.1B | $7.0B | $2.9B | $4.1B | 12.8% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 113.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 9.1% | Lower capital intensity usually supports FCF margin. |
| Net cash | n/a | 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 Recovery
Operating cash flow increased substantially from the prior quarter, driving the improvement in free cash flow despite a modest rise in capital expenditure. This sequential recovery was the strongest observable factor in the quarter's cash conversion.
The higher operating cash flow was the primary reason free cash flow and margin improved sequentially.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased from both the prior quarter and the year-ago quarter. Operating cash flow rose sequentially but fell year over year, while capital expenditure decreased compared to both periods. The resulting free cash flow was higher than the previous quarter but lower than the same quarter one year earlier, and the free cash flow margin followed the same pattern.
Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow were all higher, with capital expenditure slightly higher. Versus the same quarter one year earlier, revenue was higher but operating cash flow and free cash flow were lower, while capital expenditure was lower.
Monitor whether operating cash flow can sustain its sequential improvement given it remained below the year-ago level.