Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was higher than both the previous quarter and the same quarter last year. Free cash flow margin weakened compared to both prior periods.
- Operating cash flow was lower than the same quarter last year, while capital expenditure was higher, resulting in a lower free cash flow. The free cash flow margin reflected this decline.
- Compared to the previous quarter, revenue and operating cash flow improved, but capital expenditure also increased, leading to a slightly higher free cash flow with a slightly lower margin. Relative to the same quarter last year, operating cash flow decreased significantly while capital expenditure rose, causing free cash flow and margin to weaken substantially.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$221.6M
Trailing twelve-month free cash flow.
Quarter free cash flow
$51.6M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$142.5M
Cash generated by operations before capital spending.
CapEx
$90.9M
Capital spending and related asset purchases.
FCF margin
5.5%
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 |
|---|---|---|---|---|---|
| 2022-10-31 | $848.1M | $130.7M | $94.9M | $35.8M | 4.2% |
| 2023-01-31 | $858.5M | $166.6M | $83.0M | $83.6M | 9.7% |
| 2023-04-30 | $877.4M | $124.2M | $73.6M | $50.6M | 5.8% |
| 2023-07-31 | $930.2M | $142.5M | $90.9M | $51.6M | 5.5% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 60.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 9.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$2.5B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Free Cash Flow Margin Contraction
The free cash flow margin for the current quarter was lower than both the preceding quarter and the same period last year, driven by a combination of lower operating cash flow and higher capital expenditure.
The reduced free cash flow generation may limit financial flexibility.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was lower than the same quarter last year, while capital expenditure was higher, resulting in a lower free cash flow. The free cash flow margin reflected this decline.
Compared to the previous quarter, revenue and operating cash flow improved, but capital expenditure also increased, leading to a slightly higher free cash flow with a slightly lower margin. Relative to the same quarter last year, operating cash flow decreased significantly while capital expenditure rose, causing free cash flow and margin to weaken substantially.
Monitor the level of capital expenditure relative to operating cash flow, as it has increased notably from the prior year.