Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin weakened sequentially but improved year-over-year. Operating cash flow declined from the prior quarter while capital expenditure rose slightly.
- Revenue was stable compared to the prior quarter, but operating cash flow decreased, leading to a lower free cash flow margin. Capital expenditure was modest relative to operating cash flow, supporting a conversion rate that remained above the year-ago level.
- Compared to the prior quarter, free cash flow and margin were lower, driven by a decline in operating cash flow. Versus the same quarter last year, free cash flow and margin were higher, with revenue and operating cash flow both improved.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
$629.9M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$650.4M
Cash generated by operations before capital spending.
CapEx
$20.5M
Capital spending and related asset purchases.
FCF margin
46.3%
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 |
|---|---|---|---|---|---|
| 2022-09-30 | $1.2B | $657.8M | $24.0M | $633.8M | 51.6% |
| 2022-12-31 | $1.2B | $981.5M | $24.4M | $957.1M | 79.2% |
| 2023-03-31 | $1.4B | $902.4M | $15.2M | $887.2M | 61.5% |
| 2023-06-30 | $1.4B | $650.4M | $20.5M | $629.9M | 46.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 81.0% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.5% | 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.
Year-over-Year Cash Flow Improvement
Revenue and operating cash flow both increased compared to the same quarter last year, lifting free cash flow and margin. The filing notes that operating cash flow in the first half of 2023 benefited from higher revenue due to fee increases.
This driver supported a stronger free cash flow generation relative to the year-ago period.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable compared to the prior quarter, but operating cash flow decreased, leading to a lower free cash flow margin. Capital expenditure was modest relative to operating cash flow, supporting a conversion rate that remained above the year-ago level.
Compared to the prior quarter, free cash flow and margin were lower, driven by a decline in operating cash flow. Versus the same quarter last year, free cash flow and margin were higher, with revenue and operating cash flow both improved.
Monitor the trend in operating cash flow, as it declined from the prior quarter despite stable revenue.