Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow declined sharply from the prior quarter due to a significant reduction in operating cash flow, while revenue remained flat. Compared to the same quarter last year, free cash flow was slightly lower despite lower capital spending.
- Revenue was unchanged from the prior quarter, but operating cash flow fell substantially, leading to a much lower free cash flow and free cash flow margin. Capital expenditure was slightly lower than the prior quarter, but the decline in operating cash flow was the primary factor.
- Compared to the immediately preceding quarter, free cash flow and margin weakened significantly. Relative to the same quarter one year earlier, free cash flow was marginally lower, as a lower operating cash flow was partly offset by reduced capital expenditure.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$1.6B
Trailing twelve-month free cash flow.
Quarter free cash flow
$201.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$542.4M
Cash generated by operations before capital spending.
CapEx
$341.4M
Capital spending and related asset purchases.
FCF margin
2.0%
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 |
|---|---|---|---|---|---|
| 2024-02-02 | $9.9B | $949.8M | $459.7M | $490.1M | 5.0% |
| 2024-05-03 | $9.9B | $663.8M | $342.0M | $321.8M | 3.2% |
| 2024-08-02 | $10.2B | $988.9M | $353.7M | $635.2M | 6.2% |
| 2024-11-01 | $10.2B | $542.4M | $341.4M | $201.0M | 2.0% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | 102.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 3.4% | 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 Decline
Operating cash flow decreased substantially from the prior quarter, while revenue held steady. This reduction was the primary factor behind the lower free cash flow.
If operating cash flow does not recover, free cash flow may remain under pressure.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was unchanged from the prior quarter, but operating cash flow fell substantially, leading to a much lower free cash flow and free cash flow margin. Capital expenditure was slightly lower than the prior quarter, but the decline in operating cash flow was the primary factor.
Compared to the immediately preceding quarter, free cash flow and margin weakened significantly. Relative to the same quarter one year earlier, free cash flow was marginally lower, as a lower operating cash flow was partly offset by reduced capital expenditure.
Monitor the trend in operating cash flow, as it was the main driver of the quarter's free cash flow decline.