Free cash flow takeaway
A quick read on the company's cash generation and what it means for investors.
Free cash flow turned negative in the quarter as operating cash flow fell short of capital expenditure. Revenue was stable sequentially but lower than the same quarter last year, while cash conversion weakened significantly.
- Revenue was comparable to the prior quarter but lower than the year-ago quarter. Operating cash flow declined both sequentially and year-over-year, and with capital expenditure remaining elevated, free cash flow turned negative and the margin became negative.
- Compared with the prior quarter, revenue was stable but operating cash flow and free cash flow were lower, resulting in a weakened margin. Versus the year-ago quarter, all metrics were lower: revenue, operating cash flow, free cash flow, and margin all declined.
FCF snapshot
Quarterly and TTM cash-flow metrics with the minimum valuation context.
TTM free cash flow
$864.0M
Trailing twelve-month free cash flow.
Quarter free cash flow
-$33.0M
Free cash flow in the selected fiscal quarter.
Operating cash flow
$94.0M
Cash generated by operations before capital spending.
CapEx
$127.0M
Capital spending and related asset purchases.
FCF margin
-1.4%
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 |
|---|---|---|---|---|---|
| 2022-06-30 | $2.5B | $402.0M | $76.0M | $326.0M | 13.3% |
| 2022-09-30 | $2.5B | $502.0M | $118.0M | $384.0M | 15.4% |
| 2022-12-31 | $2.3B | $334.0M | $147.0M | $187.0M | 8.0% |
| 2023-03-31 | $2.3B | $94.0M | $127.0M | -$33.0M | -1.4% |
Cash conversion quality
Checks that separate high-quality free cash flow from accounting noise or working-capital timing.
| FCF / net income | -16.3% | Shows whether accounting earnings convert into cash. |
| CapEx / revenue | 5.4% | 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 sharply from both the prior quarter and the year-ago quarter. The filing notes that the year-over-year decline was primarily due to lower operating income.
The drop in operating cash flow drove free cash flow to a negative position, despite capital expenditure being lower than the prior quarter.
What the cash flow says
How to interpret the company's free cash flow beyond the headline number.
Revenue was comparable to the prior quarter but lower than the year-ago quarter. Operating cash flow declined both sequentially and year-over-year, and with capital expenditure remaining elevated, free cash flow turned negative and the margin became negative.
Compared with the prior quarter, revenue was stable but operating cash flow and free cash flow were lower, resulting in a weakened margin. Versus the year-ago quarter, all metrics were lower: revenue, operating cash flow, free cash flow, and margin all declined.
Monitor whether operating cash flow can recover to cover capital expenditure and restore positive free cash flow.