Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow decreased sequentially due to lower revenue and operating cash flow, while capital expenditure rose slightly. Compared to the same quarter last year, free cash flow weakened as operating cash flow declined and capital expenditure increased.
- Revenue was lower than the prior quarter, and operating cash flow decreased more sharply, resulting in a reduced free cash flow margin. The margin also weakened versus the year-ago quarter, reflecting a lower proportion of operating cash flow converted into free cash flow after higher capital expenditure.
- Compared to the immediately preceding quarter, revenue, operating cash flow, free cash flow, and free cash flow margin were all lower, while capital expenditure was slightly higher. Versus the same quarter one year earlier, revenue was higher, but operating cash flow and free cash flow were lower, and capital expenditure increased.
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
$299.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$446.5M
Cash generated by operations before capital spending.
CapEx
$147.5M
Capital spending and related asset purchases.
FCF margin
10.7%
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 |
|---|---|---|---|---|---|
| 2023-12-31 | $2.5B | $265.5M | $171.9M | $93.5M | 3.7% |
| 2024-03-31 | $2.7B | $569.2M | $132.7M | $436.5M | 16.2% |
| 2024-06-30 | $3.0B | $562.6M | $140.5M | $422.1M | 14.2% |
| 2024-09-30 | $2.8B | $446.5M | $147.5M | $299.0M | 10.7% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 77.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.3% | 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 Decline
The strongest observable driver was the lower operating cash flow in the current quarter compared to both the preceding quarter and the year-ago quarter. This directly reduced free cash flow despite a slight uptick in capital expenditure.
The reduction in operating cash flow caused free cash flow and free cash flow margin to weaken significantly versus both comparison periods.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was lower than the prior quarter, and operating cash flow decreased more sharply, resulting in a reduced free cash flow margin. The margin also weakened versus the year-ago quarter, reflecting a lower proportion of operating cash flow converted into free cash flow after higher capital expenditure.
Compared to the immediately preceding quarter, revenue, operating cash flow, free cash flow, and free cash flow margin were all lower, while capital expenditure was slightly higher. Versus the same quarter one year earlier, revenue was higher, but operating cash flow and free cash flow were lower, and capital expenditure increased.
Monitor operating cash flow trends, as its decline was the primary factor behind the reduction in free cash flow compared to both prior periods.