Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
In the current quarter, free cash flow margin improved sequentially as operating cash flow increased while capital expenditure remained similar, but the margin was lower compared to the same quarter last year. The filing indicates operating cash flows continue to be a primary liquidity source for the company.
- Revenue was stable quarter-over-quarter and higher year-over-year. Operating cash flow strengthened sequentially, resulting in a higher free cash flow margin, but operating cash flow decreased from the prior year period, leading to a lower margin compared to a year ago.
- Sequentially, free cash flow and margin improved due to higher operating cash flow and slightly lower capital spending. Compared to the same quarter last year, free cash flow and margin declined as operating cash flow was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.8B
Trailing twelve-month free cash flow.
Quarter free cash flow
$520.6M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$620.5M
Cash generated by operations before capital spending.
CapEx
$99.9M
Capital spending and related asset purchases.
FCF margin
20.0%
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 |
|---|---|---|---|---|---|
| 2024-05-31 | $2.5B | $681.8M | $101.9M | $579.8M | 23.5% |
| 2024-08-31 | $2.5B | $460.4M | $92.9M | $367.4M | 14.7% |
| 2024-11-30 | $2.6B | $444.7M | $101.4M | $343.3M | 13.4% |
| 2025-02-28 | $2.6B | $620.5M | $99.9M | $520.6M | 20.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 112.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.8% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$1.8B | Cash and equivalents minus total debt. |
Recent events shaping cash flow
Near-term business events that help explain the free cash flow result.
Sequential cash flow recovery
Operating cash flow increased from the previous quarter, driving a higher free cash flow margin despite stable capital expenditure. The filing notes that operating cash flows have historically been a key source of liquidity, funding operations, expansion, and capital allocation.
This improvement enhances the company's liquidity position, supporting its ability to fund operations and growth opportunities.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable quarter-over-quarter and higher year-over-year. Operating cash flow strengthened sequentially, resulting in a higher free cash flow margin, but operating cash flow decreased from the prior year period, leading to a lower margin compared to a year ago.
Sequentially, free cash flow and margin improved due to higher operating cash flow and slightly lower capital spending. Compared to the same quarter last year, free cash flow and margin declined as operating cash flow was lower.
Monitor the trajectory of operating cash flow relative to revenue to assess sustainability of cash conversion.