Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was stable sequentially while operating cash flow improved, leading to a higher free cash flow margin. Compared to the same quarter last year, revenue was lower but free cash flow margin strengthened as capital expenditure decreased more than operating cash flow.
- Operating cash flow exceeded capital expenditure by a wide margin, resulting in positive free cash flow. The free cash flow margin improved relative to both the prior quarter and the year-ago quarter, indicating a higher proportion of revenue converted into free cash flow.
- Compared to the immediately preceding quarter, revenue was stable, operating cash flow was higher, and capital expenditure was higher, yet free cash flow was slightly higher and the margin improved. Versus the same quarter one year earlier, revenue was lower, operating cash flow was lower, capital expenditure was lower, and free cash flow was slightly lower, but the margin was higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$365.4M
Trailing twelve-month free cash flow.
Quarter free cash flow
$142.6M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$220.9M
Cash generated by operations before capital spending.
CapEx
$78.3M
Capital spending and related asset purchases.
FCF margin
14.1%
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 |
|---|---|---|---|---|---|
| 2023-04-01 | $1.0B | $109.4M | $106.9M | $2.5M | 0.2% |
| 2023-07-01 | $1.1B | $148.1M | $67.4M | $80.7M | 7.6% |
| 2023-09-30 | $1.0B | $205.4M | $65.9M | $139.5M | 13.6% |
| 2023-12-30 | $1.0B | $220.9M | $78.3M | $142.6M | 14.1% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 76.2% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 7.7% | 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.
Improved Free Cash Flow Margin
The free cash flow margin rose sequentially and year-over-year, driven by a combination of stable revenue and a larger gap between operating cash flow and capital expenditure relative to revenue.
This margin improvement signals a stronger cash conversion efficiency for the quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow exceeded capital expenditure by a wide margin, resulting in positive free cash flow. The free cash flow margin improved relative to both the prior quarter and the year-ago quarter, indicating a higher proportion of revenue converted into free cash flow.
Compared to the immediately preceding quarter, revenue was stable, operating cash flow was higher, and capital expenditure was higher, yet free cash flow was slightly higher and the margin improved. Versus the same quarter one year earlier, revenue was lower, operating cash flow was lower, capital expenditure was lower, and free cash flow was slightly lower, but the margin was higher.
Monitor the trend in capital expenditure relative to operating cash flow, as a higher spending level this quarter did not prevent margin improvement.