Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was lower sequentially but higher year-over-year, while operating cash flow strengthened markedly compared with both prior periods. Free cash flow improved sharply versus the previous quarter and the same quarter one year earlier, supported by a stronger free cash flow margin.
- Operating cash flow as a proportion of revenue improved from the preceding quarter and the prior-year quarter, contributing to a free cash flow margin that was higher than both comparison periods. Capital expenditure was lower in absolute terms than both the immediate prior quarter and the year-ago quarter.
- Compared with the immediately preceding quarter, revenue was lower but operating cash flow was substantially higher, leading to a much higher free cash flow and margin. Versus the same quarter one year earlier, revenue was higher and operating cash flow was higher, yielding a higher free cash flow and a strengthened margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$836.8M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$856.7M
Cash generated by operations before capital spending.
CapEx
$19.9M
Capital spending and related asset purchases.
FCF margin
62.6%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $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% |
| 2023-09-30 | $1.3B | $856.7M | $19.9M | $836.8M | 62.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 111.5% | 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.
Stronger cash generation
Operating cash flow increased substantially from both the prior quarter and the year-ago quarter despite a sequential revenue decline, indicating improved conversion of revenue into cash. The free cash flow margin was the highest among the three reported periods.
This stronger cash generation provides the company with greater financial flexibility for capital allocation.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a proportion of revenue improved from the preceding quarter and the prior-year quarter, contributing to a free cash flow margin that was higher than both comparison periods. Capital expenditure was lower in absolute terms than both the immediate prior quarter and the year-ago quarter.
Compared with the immediately preceding quarter, revenue was lower but operating cash flow was substantially higher, leading to a much higher free cash flow and margin. Versus the same quarter one year earlier, revenue was higher and operating cash flow was higher, yielding a higher free cash flow and a strengthened margin.
Monitor whether revenue can sustain the year-over-year increase while maintaining the improved cash conversion efficiency seen this quarter.