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 increased sequentially as operating cash flow rose more than capital expenditure, while the free cash flow margin improved. Compared to the same quarter last year, free cash flow and margin were lower due to a decline in operating cash flow and higher capital expenditure.
- Revenue was higher than the prior quarter, and operating cash flow grew, leading to an increase in free cash flow. Capital expenditure also rose, but free cash flow margin improved. Compared to a year ago, revenue and operating cash flow were lower, and capital expenditure was higher, resulting in a weaker free cash flow margin.
- Relative to the preceding quarter, free cash flow and margin improved, driven by stronger operating cash flow. Versus the same quarter a year earlier, free cash flow and margin weakened, as operating cash flow decreased and capital expenditure increased.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$20.4B
Trailing twelve-month free cash flow.
Quarter free cash flow
$5.0B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$9.7B
Cash generated by operations before capital spending.
CapEx
$4.7B
Capital spending and related asset purchases.
FCF margin
9.6%
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 |
|---|---|---|---|---|---|
| 2022-12-31 | $54.5B | $12.5B | $3.8B | $8.7B | 15.9% |
| 2023-03-31 | $48.8B | $7.2B | $3.0B | $4.2B | 8.5% |
| 2023-06-30 | $47.2B | $6.3B | $3.8B | $2.5B | 5.4% |
| 2023-09-30 | $51.9B | $9.7B | $4.7B | $5.0B | 9.6% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 76.6% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 9.0% | 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 Recovery
Operating cash flow increased from the prior quarter, more than offsetting a rise in capital expenditure and enabling higher free cash flow.
This improvement was the primary factor behind the sequential increase in free cash flow margin.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was higher than the prior quarter, and operating cash flow grew, leading to an increase in free cash flow. Capital expenditure also rose, but free cash flow margin improved. Compared to a year ago, revenue and operating cash flow were lower, and capital expenditure was higher, resulting in a weaker free cash flow margin.
Relative to the preceding quarter, free cash flow and margin improved, driven by stronger operating cash flow. Versus the same quarter a year earlier, free cash flow and margin weakened, as operating cash flow decreased and capital expenditure increased.
Monitor capital expenditure and operating cash flow trends, as the filing notes lower operating cash flow and higher capital expenditures for the nine-month period compared to the prior year.