Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow margin weakened sharply versus both the prior quarter and the same quarter last year, driven by a lower operating cash flow conversion on relatively stable revenue. Capital expenditure was slightly higher, but the primary observable change was the decline in operating cash flow.
- Revenue was nearly unchanged from the prior quarter, yet operating cash flow fell substantially, causing free cash flow and its margin to decline. The margin was lower than both the preceding quarter and the year-ago period, indicating a weaker cash conversion from revenue.
- Compared to the prior quarter, free cash flow and margin were lower, while capital expenditure was slightly higher. Versus the same quarter last year, all cash flow metrics were lower, with the largest observable decline in operating cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.4B
Trailing twelve-month free cash flow.
Quarter free cash flow
$309.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$350.2M
Cash generated by operations before capital spending.
CapEx
$41.2M
Capital spending and related asset purchases.
FCF margin
33.0%
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 | $948.2M | $221.3M | $42.2M | $179.1M | 18.9% |
| 2023-09-30 | $970.9M | $285.7M | $38.2M | $247.4M | 25.5% |
| 2023-12-31 | $937.3M | $716.5M | $36.7M | $679.8M | 72.5% |
| 2024-03-31 | $935.3M | $350.2M | $41.2M | $309.0M | 33.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 134.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 4.4% | 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 was substantially lower than both the prior quarter and the year-ago quarter, while revenue remained relatively stable. This shift drove the reduction in free cash flow and margin.
The lower operating cash flow was the primary observable driver of the weakened free cash flow margin this quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was nearly unchanged from the prior quarter, yet operating cash flow fell substantially, causing free cash flow and its margin to decline. The margin was lower than both the preceding quarter and the year-ago period, indicating a weaker cash conversion from revenue.
Compared to the prior quarter, free cash flow and margin were lower, while capital expenditure was slightly higher. Versus the same quarter last year, all cash flow metrics were lower, with the largest observable decline in operating cash flow.
Monitor the trend in operating cash flow relative to revenue, as its decline was the strongest observable factor in the quarter.