Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned deeply negative in the quarter, driven by a large operating cash outflow that more than offset lower capital spending. The free cash flow margin weakened compared to both the prior quarter and the same quarter a year ago.
- Revenue increased relative to the prior quarter, yet operating cash flow swung from a large inflow to a substantial outflow, resulting in a negative free cash flow margin. Capital expenditure declined, but the cash conversion from revenue to free cash flow deteriorated sharply.
- Compared to the immediately preceding quarter, free cash flow shifted from a large positive to a large negative, and the margin reversed from positive to negative. Versus the same quarter one year earlier, free cash flow was more negative and the margin weakened.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$2.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$3.0B
Free cash flow in the selected fiscal quarter.
Operating cash flow
-$2.9B
Cash generated by operations before capital spending.
CapEx
$81.0M
Capital spending and related asset purchases.
FCF margin
-60.6%
The share of revenue converted into free cash flow.
TTM FCF yield
3.6%
TTM FCF divided by market capitalization.
FCF reconciliation
Free cash flow is not a GAAP line item; it should be bridged from the cash flow statement.
| Operating cash flow | -$2.9B | Cash generated by operations before capital spending. |
| Capital expenditures | $81.0M | Capital spending used to bridge CFO to FCF. |
| Free cash flow | -$3.0B | Operating cash flow less capital spending. |
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $6.3B | $1.1B | $139.0M | $970.0M | 15.5% |
| 2022-09-30 | $2.8B | -$525.0M | $142.0M | -$667.0M | -24.0% |
| 2022-12-31 | $3.8B | $3.0B | $145.0M | $2.9B | 75.1% |
| 2023-03-31 | $4.9B | -$3.3B | $151.0M | -$3.5B | -70.9% |
| 2023-06-30 | $6.0B | $812.0M | $99.0M | $713.0M | 11.8% |
| 2023-09-30 | $2.6B | -$105.0M | $162.0M | -$267.0M | -10.3% |
| 2023-12-31 | $3.7B | $4.4B | $183.0M | $4.2B | 113.0% |
| 2024-03-31 | $4.5B | -$2.6B | $148.0M | -$2.8B | -61.4% |
| 2024-06-30 | $6.1B | $451.0M | $114.0M | $337.0M | 5.5% |
| 2024-09-30 | $2.3B | $130.0M | $154.0M | -$24.0M | -1.0% |
| 2024-12-31 | $4.0B | $4.2B | $181.0M | $4.0B | 100.4% |
| 2025-03-31 | $4.4B | -$2.1B | $94.0M | -$2.2B | -49.9% |
| 2025-06-30 | $6.5B | $947.0M | $118.0M | $829.0M | 12.8% |
| 2025-09-30 | $2.6B | $193.0M | $157.0M | $36.0M | 1.4% |
| 2025-12-31 | $3.9B | $4.4B | $222.0M | $4.2B | 106.2% |
| 2026-03-31 | $4.9B | -$2.9B | $81.0M | -$3.0B | -60.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -412.8% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.7% | 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.
Operating cash flow swing
Operating cash flow turned from a significant positive in the prior quarter to a significant negative in the current quarter, and was also more negative than the year-ago quarter. This change overwhelmed the effect of lower capital expenditure.
The large negative operating cash flow drove free cash flow deeply negative, despite a reduction in capital spending.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue increased relative to the prior quarter, yet operating cash flow swung from a large inflow to a substantial outflow, resulting in a negative free cash flow margin. Capital expenditure declined, but the cash conversion from revenue to free cash flow deteriorated sharply.
Compared to the immediately preceding quarter, free cash flow shifted from a large positive to a large negative, and the margin reversed from positive to negative. Versus the same quarter one year earlier, free cash flow was more negative and the margin weakened.
Monitor the magnitude of operating cash flow relative to revenue, as its large negative swing was the primary factor behind the free cash flow deficit.
Valuation context
A cash-flow page should show how much investors are paying for the cash stream, without turning into a full DCF.
| Market capitalization | $56.8B | Used as the denominator for FCF yield. |
| TTM FCF yield | 3.6% | TTM free cash flow divided by market capitalization. |
| EV / TTM FCF | n/a | A quick valuation bridge, not a full DCF. |
Peer context
Free cash flow quality is easier to read against related public companies.
Risks and tripwires
Observable signals that would weaken the free cash flow thesis.
| Risk | Tripwire | Why it matters |
|---|---|---|
| FCF margin compression | FCF margin falls for two consecutive quarters. | Cash conversion may be weakening before earnings show it. |
| Capital intensity rises | CapEx/revenue moves materially above the recent run rate. | More operating cash flow would be consumed before becoming FCF. |
| Working capital drag | Inventory or receivables grow faster than revenue. | Reported growth may not translate into cash. |