Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue was lower than the preceding quarter but higher than the same quarter last year. Free cash flow was negative and more negative than the prior quarter, though comparable to the year-ago level.
- Operating cash flow as a percentage of revenue weakened sequentially, while capital expenditure increased, resulting in a more negative free cash flow margin compared to the prior quarter. The current quarter's free cash flow margin was similar to the year-ago quarter.
- Compared to the immediately preceding quarter, revenue and operating cash flow were lower, while capital expenditure was higher, leading to a more negative free cash flow. Versus the same quarter one year earlier, revenue was higher, operating cash flow was lower, and capital expenditure was lower, resulting in a similar free cash flow margin.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.1B
Trailing twelve-month free cash flow.
Quarter free cash flow
-$1.1B
Free cash flow in the selected fiscal quarter.
Operating cash flow
$545.0M
Cash generated by operations before capital spending.
CapEx
$1.6B
Capital spending and related asset purchases.
FCF margin
-7.4%
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 |
|---|---|---|---|---|---|
| 2023-03-31 | $12.8B | $2.2B | $1.0B | $1.2B | 9.7% |
| 2023-06-30 | $15.6B | $2.6B | $1.5B | $1.2B | 7.4% |
| 2023-09-30 | $15.5B | $1.1B | $1.3B | -$193.0M | -1.2% |
| 2023-12-31 | $14.2B | $545.0M | $1.6B | -$1.1B | -7.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -51.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 11.3% | Lower capital intensity usually supports FCF margin. |
| Net cash | -$15.9B | 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 Decline
Operating cash flow was lower than both the preceding quarter and the same quarter last year, despite revenue being higher year-over-year. This decline, combined with higher capital expenditure versus the prior quarter, drove the more negative free cash flow.
The reduction in operating cash flow was the primary measurable factor behind the sequential weakening of free cash flow.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow as a percentage of revenue weakened sequentially, while capital expenditure increased, resulting in a more negative free cash flow margin compared to the prior quarter. The current quarter's free cash flow margin was similar to the year-ago quarter.
Compared to the immediately preceding quarter, revenue and operating cash flow were lower, while capital expenditure was higher, leading to a more negative free cash flow. Versus the same quarter one year earlier, revenue was higher, operating cash flow was lower, and capital expenditure was lower, resulting in a similar free cash flow margin.
The trend in capital expenditure relative to operating cash flow, as it has a significant effect on free cash flow generation.