Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Revenue and operating cash flow both increased compared to the prior quarter and the same quarter last year, driving a substantial improvement in free cash flow and free cash flow margin. The quarter marked a shift from negative free cash flow in the preceding quarter to a strongly positive position.
- Operating cash flow was significantly higher than revenue, resulting in a free cash flow margin that exceeded the operating cash flow margin implied by the revenue level, after accounting for capital expenditure which was lower than in both comparison periods.
- Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow all improved, with free cash flow turning from negative to positive. Versus the same quarter one year earlier, revenue was higher, operating cash flow was higher, and free cash flow was higher, while capital expenditure was lower.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.0B
Trailing twelve-month free cash flow.
Quarter free cash flow
$923.7M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$940.3M
Cash generated by operations before capital spending.
CapEx
$16.6M
Capital spending and related asset purchases.
FCF margin
59.2%
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 | $791.6M | $59.5M | $25.0M | $34.6M | 4.4% |
| 2023-06-30 | $675.8M | $125.3M | $30.7M | $94.5M | 14.0% |
| 2023-09-30 | $1.1B | -$3.7M | $26.7M | -$30.4M | -2.8% |
| 2023-12-31 | $1.6B | $940.3M | $16.6M | $923.7M | 59.2% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 236.9% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 1.1% | 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 Strength
Operating cash flow was the strongest observable driver, rising substantially from both the prior quarter and the year-ago quarter, while capital expenditure declined, amplifying the increase in free cash flow.
The combination of higher operating cash flow and lower capital expenditure produced a free cash flow margin that was higher than in either comparison period.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Operating cash flow was significantly higher than revenue, resulting in a free cash flow margin that exceeded the operating cash flow margin implied by the revenue level, after accounting for capital expenditure which was lower than in both comparison periods.
Compared to the immediately preceding quarter, revenue, operating cash flow, and free cash flow all improved, with free cash flow turning from negative to positive. Versus the same quarter one year earlier, revenue was higher, operating cash flow was higher, and free cash flow was higher, while capital expenditure was lower.
Monitor whether operating cash flow can sustain its elevated level relative to revenue in subsequent quarters.