Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow fell sharply as operating cash flow declined while revenue remained nearly flat. The cash conversion margin weakened considerably compared to both the prior quarter and the same quarter last year.
- Revenue was relatively stable, but operating cash flow contracted substantially, resulting in a much lower free cash flow and a narrower free cash flow margin.
- Compared to the immediately preceding quarter, revenue, operating cash flow, capital expenditure, free cash flow, and margin were all lower. Versus the same quarter one year earlier, revenue was slightly lower, while operating cash flow, free cash flow, and margin were also lower; capital expenditure was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$107.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$276.0M
Cash generated by operations before capital spending.
CapEx
$169.0M
Capital spending and related asset purchases.
FCF margin
1.3%
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 |
|---|---|---|---|---|---|
| 2023-06-30 | $8.6B | $483.0M | $221.0M | $262.0M | 3.0% |
| 2023-09-30 | $8.4B | $1.5B | $280.0M | $1.2B | 14.8% |
| 2023-12-31 | $8.5B | $1.5B | $519.0M | $940.0M | 11.0% |
| 2024-03-31 | $8.4B | $276.0M | $169.0M | $107.0M | 1.3% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 5.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 2.0% | 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
Operating cash flow decreased sharply relative to both the prior quarter and the year-ago period, while revenue remained essentially unchanged. This drove the significant reduction in free cash flow and margin.
The lower operating cash flow directly weakened free cash flow generation and compressed the cash conversion margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was relatively stable, but operating cash flow contracted substantially, resulting in a much lower free cash flow and a narrower free cash flow margin.
Compared to the immediately preceding quarter, revenue, operating cash flow, capital expenditure, free cash flow, and margin were all lower. Versus the same quarter one year earlier, revenue was slightly lower, while operating cash flow, free cash flow, and margin were also lower; capital expenditure was lower.
Monitor the trajectory of operating cash flow, as it was the primary factor behind the decline in free cash flow.