Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
For the quarter, free cash flow margin was lower than the prior quarter and the same quarter a year ago, driven by a lower operating cash flow relative to revenue. Capital expenditure was slightly higher than the prior quarter but slightly lower than the year-ago quarter.
- Revenue was stable compared to the prior quarter and the year-ago quarter. Operating cash flow was lower than both periods, while capital expenditure was similar to the year-ago quarter and slightly higher than the prior quarter. This resulted in free cash flow and margin being lower.
- Sequentially, free cash flow and margin were lower, as operating cash flow decreased while capital expenditure increased slightly. Compared to the same quarter last year, free cash flow and margin were also lower, driven by a larger decline in operating cash flow.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$15.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$4.4B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$8.7B
Cash generated by operations before capital spending.
CapEx
$4.3B
Capital spending and related asset purchases.
FCF margin
9.0%
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 |
|---|---|---|---|---|---|
| 2024-03-31 | $46.6B | $6.8B | $4.1B | $2.7B | 5.9% |
| 2024-06-30 | $49.6B | $6.3B | $4.0B | $2.3B | 4.7% |
| 2024-09-30 | $48.9B | $9.7B | $4.1B | $5.6B | 11.5% |
| 2024-12-31 | $48.3B | $8.7B | $4.3B | $4.4B | 9.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 134.5% | 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 Weakness
Operating cash flow was lower than the prior quarter and the year-ago quarter, despite revenue being relatively stable. This was the primary factor in the reduced free cash flow margin.
A sustained lower operating cash flow could pressure free cash generation even if capital expenditure remains stable.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was stable compared to the prior quarter and the year-ago quarter. Operating cash flow was lower than both periods, while capital expenditure was similar to the year-ago quarter and slightly higher than the prior quarter. This resulted in free cash flow and margin being lower.
Sequentially, free cash flow and margin were lower, as operating cash flow decreased while capital expenditure increased slightly. Compared to the same quarter last year, free cash flow and margin were also lower, driven by a larger decline in operating cash flow.
Monitor the company's authorized stock repurchase program as noted in the liquidity discussion of the filing.