Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
This quarter's free cash flow and margin both improved relative to the previous quarter and the same quarter last year. Revenue and operating cash flow were also higher, while capital expenditure increased moderately.
- The conversion from revenue to operating cash flow strengthened, as operating cash flow rose more than revenue. After deducting higher capital expenditure, free cash flow increased and the free cash flow margin expanded.
- Compared to the immediately preceding quarter, revenue, operating cash flow, capital expenditure, free cash flow, and margin were all higher. Versus the same quarter one year ago, each metric also showed improvement, with the free cash flow margin notably higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$16.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$4.9B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$5.2B
Cash generated by operations before capital spending.
CapEx
$270.0M
Capital spending and related asset purchases.
FCF margin
34.0%
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 |
|---|---|---|---|---|---|
| 2022-07-30 | $13.1B | $3.7B | $139.0M | $3.5B | 27.0% |
| 2022-10-29 | $13.6B | $4.0B | $176.0M | $3.8B | 27.8% |
| 2023-01-28 | $13.6B | $4.7B | $170.0M | $4.6B | 33.6% |
| 2023-04-29 | $14.6B | $5.2B | $270.0M | $4.9B | 34.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 154.1% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.9% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$350.0M | 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 growth
Operating cash flow increased compared to both the prior quarter and the year-ago quarter, outpacing the growth in revenue. This was the primary contributor to the higher free cash flow and margin.
The stronger operating cash flow supported a higher free cash flow margin and overall cash generation.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
The conversion from revenue to operating cash flow strengthened, as operating cash flow rose more than revenue. After deducting higher capital expenditure, free cash flow increased and the free cash flow margin expanded.
Compared to the immediately preceding quarter, revenue, operating cash flow, capital expenditure, free cash flow, and margin were all higher. Versus the same quarter one year ago, each metric also showed improvement, with the free cash flow margin notably higher.
Monitor the trend in capital expenditure, as it increased sequentially and year-over-year.