Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow declined from the prior quarter despite stable revenue, while compared to the same quarter last year both operating cash flow and free cash flow improved. The free cash flow margin weakened sequentially but strengthened year-over-year.
- Revenue remained flat quarter-over-quarter, but operating cash flow decreased, leading to a lower free cash flow and a weaker free cash flow margin. Capital expenditure stayed relatively stable across periods.
- Compared to the immediately preceding quarter, free cash flow was lower due to reduced operating cash flow on similar revenue. Versus the same quarter one year earlier, free cash flow was higher driven by stronger operating cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$3.5B
Trailing twelve-month free cash flow.
Quarter free cash flow
$758.7M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$776.9M
Cash generated by operations before capital spending.
CapEx
$18.2M
Capital spending and related asset purchases.
FCF margin
49.5%
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 |
|---|---|---|---|---|---|
| 2023-09-30 | $1.3B | $856.7M | $19.9M | $836.8M | 62.6% |
| 2023-12-31 | $1.4B | $1.0B | $20.8M | $1.0B | 71.1% |
| 2024-03-31 | $1.5B | $892.7M | $19.8M | $872.9M | 58.7% |
| 2024-06-30 | $1.5B | $776.9M | $18.2M | $758.7M | 49.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 85.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.2% | 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 Variability
Operating cash flow decreased from the prior quarter while revenue was unchanged, resulting in a lower free cash flow margin. The filing notes that net cash from operating activities increased in the first six months versus the same period last year largely due to higher revenues.
The quarter-over-quarter drop in operating cash flow was the most observable factor affecting free cash flow performance.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue remained flat quarter-over-quarter, but operating cash flow decreased, leading to a lower free cash flow and a weaker free cash flow margin. Capital expenditure stayed relatively stable across periods.
Compared to the immediately preceding quarter, free cash flow was lower due to reduced operating cash flow on similar revenue. Versus the same quarter one year earlier, free cash flow was higher driven by stronger operating cash flow.
Monitor the trend in operating cash flow, as it was the primary factor behind the quarter-over-quarter change in free cash flow.