Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow improved significantly compared to both the prior quarter and the same quarter last year, driven by a stronger increase in operating cash flow than in capital expenditure. The free cash flow margin widened considerably, reflecting higher cash conversion efficiency.
- Revenue increased while operating cash flow grew at a faster pace, and capital expenditure rose moderately, resulting in a higher free cash flow and an improved free cash flow margin.
- Compared to the immediately preceding quarter, free cash flow and margin were higher; versus the same quarter one year earlier, both metrics were also higher, with the margin showing a larger increase.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.3B
Trailing twelve-month free cash flow.
Quarter free cash flow
$445.3M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$582.5M
Cash generated by operations before capital spending.
CapEx
$137.2M
Capital spending and related asset purchases.
FCF margin
17.7%
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 | $2.2B | $351.9M | $139.0M | $212.9M | 9.6% |
| 2022-12-31 | $2.2B | $401.6M | $143.6M | $257.9M | 11.8% |
| 2023-03-31 | $2.4B | $455.0M | $120.4M | $334.7M | 14.1% |
| 2023-06-30 | $2.5B | $582.5M | $137.2M | $445.3M | 17.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 130.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.5% | 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.
Operating Cash Flow Growth
Operating cash flow increased more than revenue and capital expenditure combined, lifting free cash flow and margin to their highest levels in the presented periods.
This resulted in a stronger cash generation capability relative to invested capital and sales.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased while operating cash flow grew at a faster pace, and capital expenditure rose moderately, resulting in a higher free cash flow and an improved free cash flow margin.
Compared to the immediately preceding quarter, free cash flow and margin were higher; versus the same quarter one year earlier, both metrics were also higher, with the margin showing a larger increase.
Monitor the trend of capital expenditure relative to free cash flow, as the company plans to continue investing in new restaurant construction and share repurchases.