Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue grew compared with the prior quarter and the same quarter last year, but operating cash flow fell, causing free cash flow and its margin to decline. The quarter's cash conversion weakened significantly.
- Revenue was higher, yet operating cash flow was lower, resulting in a lower free cash flow despite a reduction in capital expenditure. The free cash flow margin weakened, reflecting a less efficient conversion of revenue into free cash.
- Compared with the immediately preceding quarter, free cash flow and margin were lower as operating cash flow fell sharply while revenue increased slightly. Versus the same quarter one year ago, free cash flow and margin also declined, with operating cash flow lower and capital expenditure higher.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$12.2B
Trailing twelve-month free cash flow.
Quarter free cash flow
$1.5B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$1.8B
Cash generated by operations before capital spending.
CapEx
$283.0M
Capital spending and related asset purchases.
FCF margin
10.0%
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 |
|---|---|---|---|---|---|
| 2025-04-26 | $14.1B | $4.1B | $261.0M | $3.8B | 26.8% |
| 2025-07-26 | $14.7B | $4.2B | $217.0M | $4.0B | 27.4% |
| 2025-10-25 | $14.9B | $3.2B | $323.0M | $2.9B | 19.4% |
| 2026-01-24 | $15.3B | $1.8B | $283.0M | $1.5B | 10.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 48.5% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$17.2B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Cash Conversion Weakened
Operating cash flow fell from the prior quarter and from the year-ago period, while revenue increased. This resulted in a lower free cash flow margin despite a reduction in capital expenditure compared to the prior quarter.
The decline in cash conversion, combined with ongoing share repurchases and dividends disclosed in the filing, underscores the importance of operating cash flow in funding these activities.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher, yet operating cash flow was lower, resulting in a lower free cash flow despite a reduction in capital expenditure. The free cash flow margin weakened, reflecting a less efficient conversion of revenue into free cash.
Compared with the immediately preceding quarter, free cash flow and margin were lower as operating cash flow fell sharply while revenue increased slightly. Versus the same quarter one year ago, free cash flow and margin also declined, with operating cash flow lower and capital expenditure higher.
Inventory levels, which increased from the prior fiscal year-end per the filing, are a concrete item to monitor.